Uploaded by Demilade Samuel Gideon-Dada


Preface xiv
Global Connections 1.4: The Doctor Is Ill. . .But Will See You
Now 24
Chapter Summary 25
Key Terms 26
Critical Thinking Questions
Class Exercise World Café on the Emerging Workplace
Introduction to the Field of Organizational
Behaviour 1
Class Exercise IT All Makes Sense?
Self-Assessments for Chapter 1
Welcome to the Field of Organizational Behaviour! 2
What is Organizational Behaviour?
Historical Foundations of Organizational Behaviour
Why Organizational Behaviour Is Important
Why OB is Important for You
Why OB is Important for Organizations
Anchors of Organizational Behaviour Knowledge
The Multidisciplinary Anchor
The Contingency Anchor
Five-Factor Model of Personality
The Dark Triad
Jungian Personality Theory and the Myers-Briggs Type
Indicator 39
Debating Point: Should Companies Use Personality Tests to
Select Job Applicants? 40
Values in the Workplace
Types of Values
MARS Model of Individual Behaviour and Performance
Situational Factors
Task Performance
Global Connections 2.2: “Your Values Are More Important
Than Your CV” at IKEA 44
Ethical Values and Behaviour
Four Ethical Principles
Supporting Ethical Behaviour
Values Across Cultures
Global Connections 1.3: Adaptive Performance in Daimler’s
Swarm Teams 22
Organizational Citizenship Behaviours
Counterproductive Work Behaviours
Maintaining Work Attendance
Individualism and Collectivism
Power Distance
Uncertainty Avoidance
Joining and Staying with the Organization
Global Connections 2.3: Alcoa Executive Sets Ethical
Standard in Russia 44
Types of Individual Behaviour
Values Congruence
Moral Intensity, Moral Sensitivity, and Situational
Influences 45
Role Perceptions
Values and Individual Behaviour
Global Connections 1.2: Emsisoft Thrives as a Fully Remote
Organization 16
Global Connections 2.1: Is Your CEO Narcissistic? Count the
Tweets 38
Employee Motivation
Other Personality Concepts: The Dark Triad and MBTI Types 37
Diversity and the Inclusive Workplace
Employment Relationships
Caveats When Applying the Five-Factor Model
The Multiple Levels of Analysis Anchor
Work–Life Integration
What Causes Personality: Nature Versus Nurture
The Emerging Workplace Landscape
Personality and the Five-Factor Model in Organizations
Debating Point: Is There Enough Evidence to Support
Evidence-Based Management? 10
The Practical Orientation Anchor
Individual Behaviour
and Processes
Connecting the Dots: An Integrative Model of
Organizational Behaviour 8
The Systematic Research Anchor
Individual Differences: Personality and Values 31
Global Connections 1.1: 21 Days of Y’ello Care
Remote Work
Case Study Promoting Safe Behaviour at Mother Parkers 27
Achievement-Nurturing Orientation
Caveats about Cross-Cultural Knowledge
Cultural Diversity within Canada 50
Contents vii
Global Connections 2.4: Cross-Cultural Hiccups at
Beam Suntory 50
Chapter Summary 52
Key Terms 53
Critical Thinking Questions
Self-Assessments for Chapter 3
Workplace Emotions, Attitudes, and Stress
Case Study SNC-Lavalin Group Inc. 54
Team Exercise Ethics Dilemma Vignettes 55
Class Exercise Personal Values Exercise 56
Self-Assessments for Chapter 2
Emotions in the Workplace
Types of Emotions
How Emotions Influence Attitudes and Behaviour
Generating Positive Emotions at Work
Perceiving Ourselves and Others in
Organizations 58
Cognitive Dissonance 91
Self-Concept Complexity, Consistency, and Clarity
The Social Self
Emotional Intelligence Outcomes and Development
Perceiving the World around Us
Job Satisfaction
Specific Perceptual Processes and Problems
Stereotyping in Organizations
Job Satisfaction and Performance
Consequences of Distress
Global Mindset: Developing Perceptions across Borders
Stressors: The Causes of Stress
Debating Point: Do Diversity Programs Reduce
Perceptual Biases? 76
Global Connections 3.4: EY Cultivates a Global Mindset
Through International Secondments 79
Chapter Summary 80
Key Terms 81
Critical-Thinking Questions
Consequences of Affective and Continuance
Commitment 100
General Adaptation Syndrome
Awareness of Perceptual Biases
Developing A Global Mindset
Work-Related Stress and Its Management 101
Meaningful Interaction
Organizational Commitment
Building Affective Commitment
Improving Self-Awareness
Job Satisfaction and Business Ethics
Other Perceptual Effects
Job Satisfaction and Customer Satisfaction 98
Global Connections 3.3: You People! Exposing Stereotyping
in South Africa 69
Self-Fulfilling Prophecy
Job Satisfaction and Work Behaviour
Perceptual Organization and Interpretation
Global Connections 4.2: Developing Emotional Intelligence
at Indian Railways 96
Global Connections 3.2: Starbucks Nurtures Employees’
Social Identity in China 65
Improving Perceptions
Strategies for Displaying Expected Emotions
Emotional Intelligence
Self-Concept and Organizational Behaviour 64
Attribution Theory
Global Connections 4.1: Smiling in Russia: More Emotional
Labour than in Canada 93
Emotions and Personality
Managing Emotions at Work
Emotional Display Norms Across Cultures
Global Connections 3.1: Career Alignment Through
Self-Concept Clarity 61
Debating Point: Is Having Fun at Work Really a Good Idea? 91
Self-Concept: How We Perceive Ourselves
Emotions, Attitudes, and Behaviour
Individual Differences in Stress
Managing Work-Related Stress
Global Connections 4.3: Reducing Stress By
Rewarding Longer Sleeps 106
Chapter Summary 107
Key Terms 108
Critical Thinking Questions
Case Study Diana’s Disappointment: The Promotion
Stumbling Block 109
Case Study HY Dairies Ltd. 82
Team Exercise Personal and Organizational Strategies for
Developing a Global Mindset 83
Case Study Rough Seas on The Link650 110
Team Exercise Ranking Jobs on Their Emotional
Labour 112
Self-Assessments for Chapter 4
Foundations of Employee Motivation
Employee Motivation, Drives, and Needs
Employee Drives and Needs
Drive-Based Motivation Theories
Four-Drive Theory
Maslow’s Needs Hierarchy Theory 119
Global Connections 5.1: Petronas Balances Fulfilment of
Employees’ Drives 119
Expectancy Theory in Practice
Organizational Behaviour Modification and Social Cognitive
Theory 125
Organizational Behaviour Modification
Characteristics of Effective Feedback 130
Global Connections 5.3: Strengths-Based Coaching
at Stryker 131
Evaluating Goal Setting and Feedback
Organizational Justice
Scientific Management
Distributive Justice and Equity Theory
Social and Information Processing Job Characteristics 157
Psychological Empowerment Practices
Self-Leadership Practices
Personal Goal Setting
Constructive Thought Patterns 162
Global Connections 6.5: Overcoming Negative Self-Talk 163
Effectiveness of Self-Leadership
Personal and Situational Predictors of Self-Leadership 164
Chapter Summary 165
Key Terms 166
Critical Thinking Questions
Supporting Psychological Empowerment
Debating Point: Job Rotation Has Costs, Not Just Benefits 159
Designing Natural Rewards
Debating Point: Does Equity Motivate More Than Equality? 134
Procedural and Interactional Justice
Job Characteristics Model 155
Global Connections 6.4: Thriving on Enriched Jobs at
Softcom Nigeria 156
Chapter Summary 138
Key Terms 139
Critical Thinking Questions
Job Design and Work Efficiency 153
Global Connections 6.3: Job Specialization at the Arsenal of
Venice 154
Job Design Practices That Motivate
Social Cognitive Theory 127
Global Connections 5.2: KPMG Motivates Employee
Learning with Gamification 128
Sources of Feedback
Job Design and Work Motivation 155
Expectancy Theory of Motivation
Goal Setting and Feedback
Problems with Job Specialization
Case Study Predicting Harry’s Work Effort 140
Case Study Yakkatech Ltd. 166
Case Study Barrie Super Subs 141
Team Exercise Is Student Work Enriched? 167
Class Exercise Needs Priority Exercise
Self-Assessments for Chapter 5
Self-Assessments for Chapter 6
Applied Performance Practices
Decision Making and Creativity
The Meaning of Money in the Workplace
Membership- and Seniority-Based Rewards
Competency-Based Rewards
PART THREE Team Processes
Job Status–Based Rewards
Watch Out for Unintended Consequences
Job Design Practices
Learned Needs Theory
Ensure That Rewards Are Relevant 151
Global Connections 6.2: When Rewards Go Wrong
Ensure That Rewards Are Valued
Intrinsic and Extrinsic Motivation
Link Rewards to Performance
Use Team Rewards for Interdependent Jobs
Individual Differences in Needs
Improving Reward Effectiveness
Performance-Based Rewards 147
Global Connections 6.1: Skill-Based Pay at Wonderful
Company 148
Rational Choice Decision Making
Rational Choice Decision Process
Problems with Rational Choice Decision Making
Identifying Problems and Opportunities
Problems with Problem Identification 173
Contents ix
Global Connections 7.1: Choosing the Best Decision
Process at Bosch Packaging Technology 174
Identifying Problems and Opportunities More Effectively 175
Searching for, Evaluating, and Choosing Alternatives
Problems with Goals 175
Global Connections 7.2: Mental Model Myopia Almost
Rejected Seinfeld 176
Problems with Information Processing
Problems with Maximization
Evaluating Opportunities
Emotions and Intuition in Decision Making
Intuition and Making Choices
Evaluating Decisions
Remote (Virtual) Teams
Activities That Encourage Creativity
Employee Involvement in Decision Making
Success Factors for Remote Teams
Case Study Arbrecorp Ltée 228
Team Exercise Survival on the Moon 229
Self-Assessments for Chapter 8
Case Study Dogged By the Wrong Problem 195
Class Exercise Employee Involvement Incidents
Self-Assessments for Chapter 7
Debating Point: Are Remote Teams More Trouble Than
They’re Worth? 221
Global Connections 8.4: Meetups Strengthen Automattic’s
Remote Teams 222
Team Exercise Team Tower Power
Class Exercise Creativity Brainbusters
Chapter Summary 225
Key Terms 227
Critical Thinking Questions
Contingencies of Employee Involvement
Improving Decision Making and Creativity in
Teams 224
Debating Point: Should Organizations Practise
Democracy? 190
Benefits of Employee Involvement
Constraints on Team Decision Making
Organizational Conditions Supporting Creativity 186
Global Connections 7.3: Supporting Creativity for Everyone
at Estée Lauder 187
Communicating in Teams and Organizations
The Importance of Communication
A Model of Communication 234
Teams and Informal Groups
Influences on Effective Encoding and Decoding 235
Global Connections 9.1: Encoding–Decoding Challenges
Across Generations 236
Communication Channels
Benefits and Limitations of Teams
The Challenges of Teams
Team Decision Making
Characteristics of Creative People
Informal Groups
Success Factors for Self-Directed Teams
Team Dynamics
Improving Team Processes Through Team Building
Chapter Summary 193
Key Terms 193
Critical Thinking Questions
Team Development 210
Global Connections 8.2: Diverse Teams Reorganize
Rijksmuseum 211
Team Mental Models
The Creative Process
Self-Directed Teams
Evaluating Decision Outcomes More Effectively
Team Composition
Team Processes
Team Trust
Escalation of Commitment
Team Cohesion 214
Global Connections 8.3: Communal Meals Build Team
Cohesion 215
Implementing and Evaluating Decisions 182
Implementing Decisions
Team Size
Team Roles
Making Choices More Effectively
Task Characteristics
Team Norms
Emotions and Making Choices
Team Design Elements
A Model of Team Effectiveness
Organizational and Team Environment 205
Global Connections 8.1: European Firms Support Teamwork
with Obeya Rooms 206
Digital Written Communication
Social Media Communication in the Workplace 239
Global Connections 9.2: Bosch Employees Improve
Collaboration Through Social Media 240
Nonverbal Communication
Choosing the Best Communication Channel
Social Presence
Contingencies of Power
Social Acceptance
Media Richness
Communication Channels and Persuasion
Communication Barriers (Noise)
The Power of Social Networks
Debating Point: How Much Power Do CEOs Really Possess? 268
Social Capital and Sources of Power
Gaining Power Through Social Networks
Consequences of Power
Information Overload
Influencing Others
Cross-Cultural and Gender Communication
Gender Differences In Communication
Improving Interpersonal Communication
Getting Your Message Across
Active Listening
Improving Communication Throughout the Hierarchy
Digitally Based Organizational Communication
Direct Communication with Top Management
Grapevine Benefits and Limitations
Team Exercise Practising Active Listening
Self-Assessments for Chapter 9
Case Study JP Morgan’s Whale 284
Team Exercise Deciphering The (Social) Network
Team Exercise Managing Your Boss
Team Exercise Cross-Cultural Communication Game
Conflict and Negotiation in the Workplace
The Meaning and Consequences of Conflict 288
Is Conflict Good or Bad?
The Emerging View: Task and Relationship Conflict 290
Power and Influence in the Workplace
The Meaning of Power
Legitimate Power
Task Conflict
Relationship Conflict
Debating Point: Can People Avoid Relationship Conflict
During Disagreements? 292
Conflict Process Model
Structural Sources of Conflict in Organizations
Incompatible Goals 293
Global Connections 11.1: Uber Conflict with Incompatible
Goals and Differentiation 294
Deference To Power
Minimizing Relationship Conflict During Task Conflict 290
Sources of Power in Organizations
Coercive Power
Chapter Summary 281
Key Terms 282
Critical Thinking Questions
Self-Assessments for Chapter 10
Case Study Difficult Connections 257
Reward Power
Individual Differences in Organizational Politics 279
Global Connections 10.3: Playing Politics with the Vacation
Schedule 280
Case Study Resonus Corporation 283
Debating Point: Should Management Use the Grapevine to
Communicate to Employees? 254
Chapter Summary 255
Key Terms 256
Critical Thinking Questions
Organizational Politics
Minimizing Organizational Politics
Communicating Through the Grapevine 252
Global Connections 9.3: Advice to CEOs: Listen—Act—
Repeat 253
Grapevine Characteristics
Consequences and Contingencies of Influence Tactics 277
Workspace Design
Types of Influence Tactics 272
Global Connections 10.1: Ontario Firm Systemically
Supports the “Old Boys’” Network 273
Global Connections 10.2: Deadly Consequences of
Workplace Bullying 275
Nonverbal Differences Across Cultures
Referent Power
Discretion 267
Expert Power
Contents xi
Global Connections 11.2: Open Office, Hidden Conflict 295
Scarce Resources
Ambiguous Rules
Communication Problems
Evaluating the Transformational Leadership Perspective 323
Interpersonal Conflict-Handling Styles
Managerial Leadership Perspective
Cultural and Gender Differences in Conflict-Handling
Styles 299
Structural Approaches to Conflict Management
Task-Oriented and People-Oriented Leadership
Servant Leadership
Emphasize Superordinate Goals 299
Global Connections 11.3: Improving Mutual Understanding
Through Lunch Roulettes 300
Reduce Interdependence
Increase Resources
Path–Goal Leadership Theory
Leadership Substitutes Theory
Third-Party Conflict Resolution
Choosing the Best Third-Party Intervention Strategy
Resolving Conflict Through Negotiation
Distributive Versus Integrative Approaches to
Negotiation 304
The Negotiation Process
The Negotiation Setting 308
Global Connections 11.4: Reducing The Gender Wage Gap
Through Negotiation Skills 309
Gender And Negotiation
Chapter Summary 310
Key Terms 311
Critical Thinking Questions
Authentic Leadership
Debating Point: Should Leaders Really Be Authentic All the
Time? 334
Personal Attributes Perspective Limitations and Practical
Implications 335
Cross-Cultural and Gender Issues in Leadership
Chapter Summary 336
Key Terms 337
Critical Thinking Questions
Self-Assessments for Chapter 12
Team Exercise Kumquat Conflict Role Play
Self-Assessments for Chapter 11
PART FOUR Organizational
Leadership in Organizational Settings 316
Designing Organizational Structures
What is Leadership? 317
Division of Labour
Develop and Communicate a Strategic Vision 319
Global Connections 12.1: Art Phillips’ Vision of a Livable
Vancouver 320
Elements of Organizational Structure
Centralization and Decentralization
Coordinating Work Activities 342
Global Connections 13.1: ESA Coordinates Satellite Design
Through Concurrent Engineering 343
Span of Control
Build Commitment Toward the Vision
Division of Labour and Coordination
Transformational Leadership Perspective
Encourage Experimentation
Gender and Leadership 335
Team Exercise Leadership Diagnostic Analysis
Case Study Conflict-Handling Incidents 313
Model the Vision
Eight Important Leadership Attributes 331
Global Connections 12.3: Transformational Leader Carolyn
McCall Identifies Important Leadership Attributes 332
Case Study A Window on Life 337
Case Study Discord Investments 312
Shared Leadership
Prototypes of Effective Leaders
Personal Attributes Perspective of Leadership
Clarify Rules and Procedures
Preparing to Negotiate
Path–Goal and Leadership Substitutes Theories
The Romance of Leadership
Implicit Leadership Perspective
Improve Communication and Mutual Understanding
Interdependence of Managerial and Transformational
Leadership 323
Choosing The Best Conflict-Handling Style 298
Reduce Differentiation
Transformational Leadership and Charisma 321
Global Connections 12.2: Did Charismatic Leadership
Cause Steinhoff’s Downfall? 322
Mechanistic Versus Organic Structures
Forms of Departmentalization
Simple Structure
Organizational Culture and Business Ethics
Merging Organizational Cultures
Functional Structure
Bicultural Audit
Matrix Structure
Changing and Strengthening Organizational Culture
Align Artifacts with the Desired Culture
Debating Point: DO Organizations Really Need to Adopt a
Matrix Structure? 358
Contingencies of Organizational Design
External Environment 360
Global Connections 13.4: The Risk of Centralizing Authority
During Pandemics 361
Organizational Size
Organizational Strategy
Elements of Organizational Culture
Organizational Change
Lewin’s Force Field Analysis Model
Why Employees Resist Change
Deciphering Organizational Culture Through Artifacts
Organizational Stories and Legends
Understanding Resistance to Change
Physical Structures and Symbols
Content of Organizational Culture 369
Global Connections 14.1: Takata’s Espoused Versus
Enacted Organizational Values 370
Rituals and Ceremonies
Learning and Adjustment Process 385
Global Connections 14.4: Junior Investment Analysts
Experience Psychological Contract Violations 386
Case Study Hillton’s Transformation 392
Team Exercise Organizational Culture Metaphors
Self-Assessments for Chapter 14 394
Organizational Language
Organizational Socialization 385
Chapter Summary 390
Key Terms 391
Critical Thinking Questions
Organizational Subcultures
Use Attraction, Selection, and Socialization for
Cultural Fit 384
Improving the Socialization Process
Case Study Merritt’s Bakery 364
Team Exercise The Club ED Exercise 365
Self-Assessments for Chapter 13 366
Organizational Culture
Support Workforce Stability and Communication 384
Stages of Organizational Socialization
Introduce Culturally Consistent Rewards and
Recognition 383
Psychological Contracts
Chapter Summary 363
Key Terms 363
Critical Thinking Questions
Model Desired Culture Through Actions of Founders and
Leaders 382
Network Structure
Strategies for Merging Different Organizational
Cultures 380
Global Connections 14.3: Alaska Air’s Acquisition of Virgin
America: From Separation to Integration 381
Divisional Structure 352
Global Connections 13.2: Toyota’s Evolving Divisional
Structure 354
Global Connections 13.3: Bosch Powers Ahead with a
Team-Based Organizational Structure 355
Team-Based Structure
Is Organizational Culture Important? 374
The Meaning and Potential Benefits of a Strong
Culture 375
Contingencies of Organizational Culture and
Effectiveness 376
Debating Point: Is Corporate Culture an Overused
Phrase? 377
Global Connections 14.2: Uber Shifts Gears Toward a More
Ethical Culture 378
Unfreezing, Changing, and Refreezing
Creating an Urgency for Change
Reducing the Restraining Forces 402
Global Connections 15.1: Supporting Change Through
Communication at EE 404
Refreezing the Desired Conditions 405
Global Connections 15.2: New Systems and Structures
Reinforce Change at Superior Cabinets 405
Leadership, Coalitions, and Pilot Projects
Transformational Leadership and Change
Coalitions, Social Networks, and Change
Pilot Projects and Diffusion of Change 406
Global Connections 15.3: Trailblazing Viral Change at RSA
Insurance 407
Four Approaches to Organizational Change
Action Research Approach
Team Exercise Strategic Change Incidents 418
Self-Assessments for Chapter 15
Debating Point: What’s the Best Speed for Organizational
Change? 409
Appreciative Inquiry Approach
Large Group Intervention Approach
Additional Cases
Organizational Behaviour: The Journey Continues
Glossary GL-1
Critical Thinking Questions
Case Study Transact Insurance Corporation 416
Theory Building and Systematic Research Methods AP-1
Cross-Cultural and Ethical Issues in Organizational Change 413
Key Terms
Parallel Learning Structure Approach 412
Chapter Summary
culture of teamwork; how Canadian financial services giant
Manulife strives to be an inclusive workplace through nonconscious bias training; how Galvanize CEO Laurie Schultz
has applied leadership practices to transform the Vancouverheadquartered organization into the global leader in cloudbased governance, risk management, and compliance
software; how Canada Post generated feelings of inequity
due to its different pay practices for urban versus rural/suburban mail carriers; and how Atlantic Lottery Corporation
has become an award-winning hive of creativity by applying
design thinking practices.
Welcome to the exciting world of organizational behaviour! Knowledge is replacing infrastructure. Social media
and remote teams are transforming the way employees
work together. Employees are guided more by values and
self-leadership than by command-and-control management.
Companies are looking for employees with emotional intelligence and effective teamwork skills, not just technical smarts.
Canadian Organizational Behaviour, Eleventh Edition, is
written in the context of these emerging workplace realities.
This edition explains how work–life integration is becoming
an essential employee practice in the workplace; how social
networks generate power and shape communication patterns;
how emotions influence employee motivation, attitudes, and
decisions; how self-concept is a significant determinant of
individual behaviour, team cohesion, and leadership; and
how adopting a global mindset has become an important
employee characteristic in this increasingly interconnected
world. This book also adopts the view that organizational
behaviour is not just for managers; it is relevant and valuable
to anyone who works in and around organizations.
Canadian and Global Focus
Canadian Organizational Behaviour, Eleventh Edition,
is written by Canadians for Canadians. It includes several
Canadian cases, is anchored by Canadian and global scholarship, and is filled with Canadian examples of organizational behaviour in practice. For example, you will read
about how Verafin in St. John’s, Newfoundland, thrives on a
©SFIO CRACHO/Shutterstock
Employees at Halifax-based Bluedrop Training and Simulation engage in divergent thinking to design and develop stateof-the-art training and simulation products. Tushar Sehgal descr bes one such incident. The Bluedrop technical project
manager and a co-worker were shopping at Home Depot when they saw a black pipe coupling product. They soon
realized that it could become the hand tracking mechanism they needed for Bluedrop’s prototype of the world’s first
virtual-reality helicopter crew trainer. “It was one of those ‘aha’ moments,” says Sehgal. “We put that around our wrists as
a joke and then realized, wa t, this is going to work.” The employees bought two of them, drilled holes, attached markers,
and found out that the item worked nicely. “There [are] many stories like that inspiration coming from random parts and
random shopping trips,” Sehgal observes.*
*Based on nformation in: T Ayres “Hel cop er Simulator Accompanies CH 148 Cyclones ” Halifax Chronic e Herald February 24 2018 B1
Along with its Canadian focus, this book has been written from the view that globalization has a profound influence
on the workplace. We continue this global focus by discussing several international and cross-cultural issues throughout
the book. Furthermore, every chapter includes truly global
examples, not just how companies from North America
operate in other parts of the world.
For example, we describe how smiling at customers tends
to create more emotional labour in people from Russia than
from Canada; how the witty “You People!” commercial
produced by South African restaurant chain Nando’s pokes
fun at our tendency to stereotype others; how ING Bank
and other European firms have introduced Obeya rooms to
encourage more team-oriented decision making; how communication has been a key ingredient for successful organizational change at EE, the United Kingdom’s largest mobile
network; and how Emsisoft and Automattic succeed as
distributed organizations with staff who work completely
remotely around the world.
Global Connections 3.3
South African restaurant chain Nando’s recently
launched a witty advertisement that pokes fun at our
tendency to stereotype people who are different from
us. The “You People” video has several brief scenes
where viewers easily misperceive the actors’ role in
the scene (upscale customer versus employee) or the
meaning of their actions (running for exercise versus
running away from police). It also shows that those
who stereotype “you people” fail to recognize similar
behaviour in themselves.
“‘You people’ is a phrase often used by South
Africans when describing people who are different to
them,” says Doug Place, Nando’s chief marketing officer
in Johannesburg. “It’s a phrase that goes hand in hand
with an unconscious bias.”
Place explains that Nando’s created the ad to
encourage discussion about stereotyping and to promote
©Aaron Amat/Shutterstock
greater harmony in society. “If you’re watching our ad
and say ‘I’ve done that’ (hopefully with a guilty smile),
then we’ve been successful at starting a crucial conversation—hopefully one that starts with ‘us people’.”
* J Richardson “Nando’s Takes on Stereotypes w th Their H lar ous New Ad #YouPeople [V deo] ” The South African November 26 2018 J Tennant
“#NewCampaign All You People This Ad s for You ” Advertis ng News November 26 2018
Linking Theory with Reality
econd Pass
Every chapter of Canadian Organizational Behaviour,
Eleventh Edition, is filled with examples to make OB knowledge more meaningful and to illuminate the relevance and
excitement of this field. These stories about real people and
academic theories into useful knowlanizationa translate
edge and real-life applications. For example, we describe
Canada’s Jeremy Gutsche has built his expert power
ter yo s o ld be
abl as
t one of the world’s leading trend spotters; how Uber executives are replacing the transportation
network firm’s dysfunctional culture with one that is more
change and ethical; how medical devices firm Stryker
leadersh p w th
transformat motivation
nal eadersh p, and
cribe the
andd performance
ted p opl riented, nd servan
de sh .
strengths-based coaching; how a new organizational strucp h g
h ry
der p s b
ture helped Sobeys (Canada’s second-largest food retailer)
and ultimately
prosperd following
a disastrous acquil
h f
sition; and how IKEA focuses on personal values when hiring
s milarities and
di fere the
ces nworld.
leade This
job applicants
edition also relates the
COVID-19 pandemic to several OB concepts and practices.
examples about work life. Lengthier stories appear in Global
Connections, which “connect” OB concepts with real organizational incidents and situations around the world. Case studies in each chapter as well as video case studies associated
with this book connect OB concepts to emerging workplace
realities. These anecdotes and detailed descriptions discuss
large and small organizations in a wide range of industries
across Canada and globally.
Contemporary Theory Foundation
Vivid real-world examples and practices are valuable only if
they are connected to good theory. Canadian Organizational
Behaviour has developed a reputation for its solid foundation of contemporary and classic research and writing. This
evidence-based foundation is apparent from the amount and
quality of literature cited in each chapter, including dozens
of articles, books, and other sources. This results in what we
believe is the most up-to-date organizational behaviour textbook available. These references also reveal that we reach out
to marketing, information management, human resource management, and other business disciplines for new ideas. This
book is rigorously focused on information that readers value,
namely OB knowledge and practices. Consequently, with
Se nd
few classic exceptions, we avoid writing a “who’s-who” book;
most scholars are named in the references, not in the main text.
EXHIBIT 1.7 MARS Model of Individual Behaviour and Results
Photo by Good Side Photo and provided by the Greater Vancouver Board
of Trade
These case studies and anecdotes appear in many forms.
Every chapter of Canadian Organizational Behaviour,
Eleventh Edition, is filled with captioned photos and in-text
MARS Model
Emotions and
Galvanize CEO Laurie Schultz is recognized as one of
Canada’s best business leaders due to her vision, role
modelling, transparent communication, and personalized
support for employees at the Vancouver-based GRC
software company.
and results
• Task performance
• Organizational
• Counterproductive
work behaviours
• Joining/staying with
the organization
• Maintaining
One of the driving forces for writing Canadian
Organizational Behaviour was to provide a more responsive conduit for emerging OB knowledge to reach students,
practitioners, and fellow scholars. To its credit, Canadian
Organizational Behaviour is apparently the first major
OB book to discuss the full self-concept model (not just
core self-evaluation), workplace emotions, social identity theory, global mindset, four-drive theory, predictors
of moral intensity, specific elements of social networks,
appreciative inquiry, affective events theory (but without
the jargon), somatic marker hypothesis (also without the
jargon), remote teams, Schwartz’s values model, employee
engagement, learning orientation, social and information processing characteristics of job design, and several
other groundbreaking topics. This edition continues this
leadership by introducing the latest knowledge on design
thinking, the shifting trends in digital communication in
organizations, five strategies for regulating emotions, key
cultural values of Indigenous Canadians, several caveats
when applying the five-factor personality model, the ethic
of care, psychological safety in team decision making and
conflict management, four criteria for selecting the preferred communication channel, and reducing dysfunctional
conflict through intergroup mirroring.
Organizational Behaviour
Knowledge for Everyone
Another distinctive feature of Canadian Organizational
Behaviour, Eleventh Edition is that it is written for everyone
in organizations, not just managers. The philosophy of this
book is that everyone who works in and around organizations needs to understand and make use of organizational
behaviour knowledge. People throughout the organization—
systems analysts, production employees, accounting professionals, and others—are taking on more responsibilities as
a T ee
am ro esses
layers of management and give the rest
upp rt psy holog al safety Psycho og l saf ty efe s
with co-workers opi
of us
for our
sy hol work
c safety outt
d b li f t i i fe t
i n
r k a g (see Cha te 8) I ot er o ds m loye s are
i nti s ow d on
to e g ge nterper onal
confid n This
th t pres book
ing nusua helps
ideas o st everyone
ctiv ly
a to
the Sh
wing pos sense of organizafical y
g ee g w
m j y,
p m
n w
se n n ual eas con
s tools
ctively dis to
reei work
w h
work behaviour,
h viou s i l no cause and
o wo ke provides
t thre t n
disp conceptual
ing ositi e em
flou ish
s when team and or in
n za othe
al no ms
e courage
One of the core ideas in conflict theory is that people can
disagree with each other regarding an issue (task conflict)
without experiencing negative emotions toward each other
(relationship conflict) The most popular book on negotia
tion makes this point by stating that the parties need to
“separate the people from the problem ”* It advises that the
participants need to view themselves as “working side by
side attacking the problem not each other”
Scholars do recognize that separating task from relation
ship conflict isn’t easy but they claim it is possible ** People
with we l developed emotional intel igence can control nega
tive emotional reactions (anger frustration hurt etc ) and can
reframe the conflict as a constructive event rather than as a
personal attack Research also suggests that relationship con
flict is less likely to occur when the parties understand each
other’s views such as in high performing teams Psychological
safety norms have also been identified as a way to avoid rela
tionship conflict while engaging in task conflict
The abi ity to avoid relationship conflict during task con
flict sounds promising in theory yet in practice it may be
a bridge too far Instead some degree of relationship con
flict may be inevitable One of the most basic problems is
that employees immediately and automatically experience
negative emotions when they become aware that co work
ers or supervisors disagree with their ideas or behaviour ***
Negative emotions aren’t just attributed to information
in the opposing message; they are also attributed to the
source of that message This occurs because we naturally
try to make sense of disruptive conditions and this includes
forming adverse interpretations about why a co worker has
disagreed with our proposal or behaviour Consequently
relationship conflict seems to form as soon as we become
aware that our ideas or actions are being challenged
Relationship conflict may also be unavoidable because it
disrupts the current or expected pattern of behaviour which
produces negative emotions toward those who caused that
disruption People have a natural desire to maintain the sta
tus quo **** Even those who propose change want to see their
ideas flow predictably through to the future without opposi
tion This effect occurs because people want to believe they
control their situation whereas disagreement reduces per
ceived control and predictability in the work environment
Relationship conflict may also be inevitable in any disagree
ment because all communication has both a relational and
substantive function ***** This means that when people interact
with each other they not only transmit and receive informa
tion (substantive) but also reinforce or strain the fabric of their
relationship Communication is important for one’s related
ness needs so a message that challenges another viewpoint
(substantive) also seems to challenge the relationship
* R Fisher and W Ury Gett ng to Yes Negotiating an Agreement wi hout G v ng In (Random House 2012) Although few believe task and relat onship conflict can be
completely separated (F sher and Ury ncluded) several scholars have developed act v ties that emphas ze the possib lity of his separat on For example see L Boyd
M Gupta and F Kuzm ts “The Evaporating Cloud A Tool for Resolving Workplace Con lict ” Internat onal Journal of Con lict Management 22 (2011) 394 412 C A
Blair and D E Desplaces “Con lict Management hrough the Negotiations Canvas Gett ng Participants to Understand ” Confl ct Resolution Quarterly 36 (2018) 39 51
**For a summary of these v ews see T A O’Neill et al “The Structure and Funct on of Team Confl ct State Profiles ” Journal of Management 44 (2018) 811 36
*** M D Seery et al “Alone against the Group A Unanimously D sagreeing Group Leads to Conformity but Cardiovascular Threat Depends on One’s Goals ”
Psychophysiology 53 (2016) 1263 71 A Hageme ster and J Volmer “Do Social Conflicts at Work Affect Employees’ Job Satisfact on? The Moderating Role of
Emotion Regulation ” International Journal of Conflict Management 29 (2017) 213 35
**** W Samuelson and R Zeckhauser “Status Quo Bias in Decision Making ” Journal of Risk and Uncertainty 1 (1988) 7 59 D Proudfoot and A C Kay “System
Justif cation n Organizat onal Contexts How a Mot vated Preference for he Status Quo Can A fect Organ zational Attitudes and Behaviors ” Research n
Organizational Behavior 34 (2014) 173 87 D De Clercq and I Belausteguigoit a “Overcom ng the Dark S de of Task Conflict Buffering Roles of Transformational
Leadersh p Tenac ty and Passion for Work ” European Management Journal 35 (2017) 78 90
***** A C Mooney P J Holahan and A C Amason “Don’t Take t Personally Exploring Cogn tive Con lict as a Mediator of A fective Con lict ” Journal of Management
Stud es 44 (2007) 733 58 S J Beck and J Keyton “Perceiving Strateg c Meeting Interaction ” Sma l Group Research 40 (2009) 223 46 L R We ngart et al “The
Directness and Oppositional Intens ty of Conflict Express on ” Academy of Management Review 40 (2015) 235 62
Active Learning and Critical
Thinking Support
We teach organizational behaviour, so we understand how
important it is to use a textbook that offers deep support
for active learning and critical thinking. Business school
accreditation associations also emphasize the importance
of the learning experience, which further reinforces our
attention on classroom activities. Canadian Organizational
Behaviour, Eleventh Edition, includes more than two dozen
case studies in various forms and levels of complexity. It
offers four dozen self-assessments, most of which have been
empirically tested and validated.
Student critical thinking is further aided with a Debating
Point in each chapter. This feature demonstrates that seemingly obvious OB knowledge may be contested by contrary
evidence and logical counterarguments. Debating Point
boxes encourage students to continuously seek out divergent
viewpoints and evidence rather than unquestioningly accept
the validity of existing theories and practices.
Canadian Organizational Behaviour, Eleventh Edition, is
also a rich resource
for in-class activities, such as the Kumquat
Key Term
Conflict Role Play, Personal Values Exercise, Employee
u u
Involvement Cases,
organiz World
i nal social
artifa ts Deciphering the (Social) Network,
s ch g l c
i n
) eory
Café on the Emerging
stic job p eview
bicultural udit Workplace, Ethics Dilemmar Vignettes,
remo ie
and the Cross-Cultural
Communication Game.
i t t
Critical Thinking Questions
1. Superb Consultants has submitted a proposal to analyze
your organization’s culture. The proposal states that
Superb has developed a revolutionary new survey to
tap the company’s true culture. The survey takes just 10
minutes to complete, and the consultants say results can
be based on a small sample of employees. Discuss the
merits and limitations of this proposal.
2. All members of the executive team at Claybuild, a
national manufacturer of bricks and related building
materials, strongly believe that quality control and efficiency are the two cornerstones of the company’s future
success. Every Claybuild executive meeting begins by
discussing ways to improve product quality and operate
more efficiently in the manufacturing process, distribution system, and administrative processes. The company’s website proudly describes its dedication to quality
and efficiency. The CEO has given speeches to several
retail client events on Claybuild’s quality–efficiency culture. However, an industry expert suggests that quality
and efficiency represent Claybuild’s espoused culture,
but not so much its enacted culture. What does the industry expert mean by this, and what evidence might suggest
that their opinion is correct?
3. The CEO of a manufacturing firm wants everyone to
support the organization’s dominant culture of lean efficiency and hard work. The CEO has introduced a new
reward system to reinforce this culture and personally
interviews all professional and managerial applicants to
ensure that they bring similar values to the organization.
Some employees who criticized these values had their
careers sidelined until they left. Two midlevel managers
were fired for supporting contrary values, such as work–
life integration. Based on your knowledge of organizational subcultures, what are the potential problems the
CEO is creating?
Changes to the Eleventh Edition
Canadian Organizational Behaviour, Eleventh Edition,
has received more updating and revision than any previous
edition of this book. In fact, the word “renewal” comes to
mind when viewing the changes in some chapters. These
improvements have occurred thanks to reviews from organizational behaviour instructors across several countries, along
with our regular practice of scanning the diverse literature
for new evidence-based information. The most substantial
changes have occurred in Chapter 1 (Introduction to the
Field of Organizational Behaviour), Chapter 2 (Individual
Differences: Personality and Values), Chapter 5 (Foundations
of Employee Motivation), Chapter 8 (Team Dynamics),
Chapter 9 (Communicating in Teams and Organizations),
and Chapter 11 (Conflict and Negotiation in the Workplace).
Together with dozens of conceptual improvements, this
edition replaces most examples with new real-world stories
that satisfy our criteria of being relevant, recent, and interesting. Fourteen of the fifteen chapter-opening case studies are
new. Most of the captioned photos and Global Connections
features are new or updated. We have also added new content on Indigenous Canadians regarding cultural values, nonconscious bias, communication styles, and other OB topics.
This edition has dozens of new in-text examples as well as
several new case studies and class activities to support the
active learning process. Most OB by the Numbers features
have also been updated or replaced.
Here are the main conceptual improvements in Canadian
Organizational Behaviour, Eleventh Edition:
• Chapter 1: Introduction to the Field of Organizational
Behaviour—Almost every section of this chapter has
been revised, updated, or replaced. This edition has a
new section on the emerging workplace landscape, which
includes new content on work–life integration, the
inclusive workplace, and employment relationships.
It also significantly updates the topic of remote work
(the narrower topic of telecommuting was covered in previous editions). The section on the importance of organizational behaviour now more fully explains why OB
is important for students. It also succinctly introduces
key organizational effectiveness concepts to explain why
OB is vital for organizations. The section on OB anchors
now includes a fifth anchor on OB’s practical orientation. This chapter also has a stronger micro-OB focus
by including the MARS Model of individual behaviour
and the five types of individual behaviour (previously in
Chapter 2).
• Chapter 2: Individual Differences: Personality and
Values—Along with its slightly revised title, this edition
brings a number of noticeable updates and changes to the
chapter. It now has a full discussion about the dark triad
(Machiavellianism, narcissism, and psychopathy) and its
relevance to organizational behaviour. This edition also
has a new separate discussion regarding four caveats when
applying the five-factor model of personality in organizations. Also included in this edition is a fourth ethical principle: the ethic of care. We have also moved the topics of
MARS Model and types of individual behaviour from this
chapter to Chapter 1.
• Chapter 3: Perceiving Ourselves and Others in
Organizations—This book pioneered the full model of
self-concept and its relevance to organizational behaviour. This edition further refines that discussion, particularly in explaining how people develop self-concept
clarity and how self-concept characteristics affect behaviour and performance. This chapter also updates writing
on perceptual organization and interpretation, intentional
discrimination, and improving self-awareness of perceptual biases.
• Chapter 4: Workplace Emotions, Attitudes, and Stress—
This was the first OB book to fully incorporate the
concept of emotions in organizational behaviour across
various topics (perceptions, attitudes, motivation, decisions, etc.). This edition further develops this topic by
revising the section on managing emotions and adding
recent knowledge about the five strategies that people
use to regulate their emotions. This edition also updates
the topic of organizational commitment, incorporates
normative commitment, and has minor rewriting on managing workplace stress.
• Chapter 5: Foundations of Employee Motivation—This
edition significantly revises and updates the topics of procedural and interactional justice, including a new exhibit
listing the specific rules of these two forms of organizational justice. The characteristics of effective feedback are
discussed more fully, including the addition of an exhibit
that defines and illustrates each characteristic. The section
on drive-based motivation theories has been reorganized
to place more emphasis on the recent four-drive theory.
This edition also revises the chapter’s opening topic on
the meaning of motivation and engagement.
• Chapter 6: Applied Performance Practices—Along with
replacing most examples and updating references, this
chapter has a number of subtle changes, notably on motivational job design practices, financial reward practices, and
psychological empowerment. It also has a new Debating
Point feature.
Chapter 7: Decision Making and Creativity—This chapter has been substantially revised and updated in several
ways. It presents the emerging topic of design thinking as
a creative decision-making practice, including its associated principles and activities. Another area that has been
substantially rewritten is the topic of problems with information processing when choosing alternatives. This edition
has added a visual example illustrating how valences and
probabilities are applied in rational choice decision making.
Other noticeable revisions involve problems with maximization and evaluating decision outcomes more effectively.
Chapter 8: Team Dynamics—We have revised, clarified,
updated, and generally improved several sections of this
chapter. The entire team effectiveness model has been
streamlined and most of the team processes section has
been reorganized and rewritten. That section now has a
more complete and updated discussion of team mental
models as well as updated content on team norms and
team roles. This edition also has more complete discussion than in previous editions on psychological safety as
a factor in effective team decision making. Other topics
that benefited from minor rewriting and updating include
how teams motivate employees, how to minimize social
loafing, characteristics of remote (virtual) teams, and the
three factors that distinguish types of teams.
Chapter 9: Communicating in Teams and Organizations—
This edition has substantially rewritten the section on
choosing the best communication channel. This topic now
fully discusses four key factors (synchronicity, social presence, social acceptance, and media richness), along with
their associated contingencies to communication channel
selection. We have also substantially updated the topic
of digital communication, including a new exhibit on the
rapidly changing popularity of various digital communication channels, along with associated discussion about why
these changes are occurring. Social media communication
is also more fully defined and discussed.
Chapter 10: Power and Influence in the Workplace—The
topic of nonsubstitutability as a contingency of power
has been rewritten, and the associated topic of personal
brand is discussed more fully. We more fully discuss the
troubling issue of deference to power in organizations.
The definition of organizational politics is explained in
more detail, particularly with reference to recent writing about “positive politics.” Other topics on organizational politics—individual differences and minimizing
politics—have been rewritten.
• Chapter 11: Conflict and Negotiation in the Workplace—
This edition significantly revises most sections of this
chapter. The topic of task and relationship conflict has
been revised for greater clarity. That section also significantly updates strategies to minimize relationship conflict
during task conflict, including the role of psychological
safety. A new Debating Point feature has also been added
around that topic. The topic of conflict-handling contingencies has been revised, and now includes the factor
of maintaining harmony. You will also find noticeable
updates on structural ways to manage conflict, particularly
on reducing differentiation and on improving communication and mutual understanding. The section on negotiation has also been significantly revised and streamlined.
It now provides better clarity on the distributive versus
integrative approach to negotiations, the importance of
setting goals and understanding needs, and the process of
information gathering. The negotiation setting also now
includes information about settings and audiences as well
as recent knowledge about gender and negotiation.
• Chapter 12: Leadership in Organizational Settings—The
most significant change in this chapter is that it reorganizes
and revises the managerial leadership section, including
the removal of a couple of older topics. The discussion
about transformational leadership and charisma has
been rewritten. Other refinements and updates are found
on the strategic vision of transformational leadership,
servant leadership, and leadership substitutes theory
(including a new exhibit).
• Chapter 13: Designing Organizational Structures—This edition updates discussion on span of control. The mechanisticorganic structures exhibit has been revised for better
clarity and style. The types of divisional structure exhibit
has also been revised with new company examples.
This edition also includes a new Debating Point feature.
• Chapter 14: Organizational Culture—In this edition,
several aspects of the organizational socialization section
have been revised, such as discussion on the inherent
conflicts in pre-employment socialization and the issue
of whether socialization changes employee values or
mostly communicates values-consistent behaviour. This
chapter has minor revisions on the meaning of a strong
organizational culture, organizational culture and business ethics, and merging organizational cultures.
• Chapter 15: Organizational Change—This chapter has
relatively minor changes from the previous edition. It
updates and revises some writing on appreciative inquiry
and on the dynamics of unfreezing, changing, and
refreezing change.
Emp oyees an the
uperv so
s at rLearning
eCorp are aware
10 nute and c
Th s abu described
has worsene above
recentl refer
particu arly
th after
The changes
onlyo to
the concepW
p y
a e
a y
tual content
packa n d artm nt als
m to r pat
t s t Canadian
3 Wh
loss pattern Behaviour,
er a few days. though
they eEdition,
punctual dalso has
improved technology supplements, cases, Team Exercises,
© C pyr gh
95 Ste en
and Self-Assessments.
i t i
Team Exercise:
Purpose This exercise is designed to help you understand
team roles, team development, and other issues in the development and maintenance of effective teams.
Materials The instructor will provide enough LEGO®
pieces or similar materials for each team to complete the
assigned task. All teams should have identical (or very similar) amounts and types of pieces. The instructor will need
a measuring tape and stopwatch. Students may use writing
materials during the design stage (see Instructions). The
instructor will distribute a “Team Objectives Sheet” and
“Tower Specifications Effectiveness Sheet” to all teams.
Instructions The instructor will divide the class into teams.
Depending on class size and space availability, teams may
have between four and seven members, but all should be
approximately equal size.
Each team has 20 minutes to design a tower that uses only
the materials provided, is freestanding, and provides an optimal return on investment. Team members may wish to draw
their tower on paper or a flip chart to facilitate the tower’s
design. Teams are free to practise building their tower during
this stage. Preferably, each team will have a secluded space so
Every chapter includes at least one short case that challenges
students to diagnose issues and apply ideas from that chapter.
Eleven additional cases appear at the end of the book.
Experiential exercises and self-assessments represent an
important part of active learning. Canadian Organizational
Behaviour, Eleventh Edition, facilitates this important
learning process by offering one or more team or class
exercises in every chapter. Self-assessments personalize
the meaning of several organizational behaviour concepts,
and this edition features four dozen of them in Connect,
with automated scoring and detailed feedback. Small callout icons in every chapter help students locate text content
most relevant to each of these excellent resources. In addition, the last page of each chapter has a convenient table
that briefly describes the self-assessments in Connect associated with that chapter.
Case Study:
by Steven L. McShane, University of Newcastle (Australia)
More than 3 million dogs enter animal shelters each year in
the United States, and almost one-third of these have been
surrendered by their owners. Until recently, animal shelter
employees assumed that the owners didn’t want their pets
anymore, so they focused their resources on ways to get the
surrendered dogs re-adopted with new owners.
Now, animal shelters recognize that they were focused on
the wrong problem to some extent. Most owners of surrendered dogs love their pets but believe they are unable to keep
them due to financial or family difficulties. “Owner surrenders are not a people problem,” explains Lori Weise, founder
of Downtown Dog Rescue in Los Angeles. “By and large,
they are a poverty problem. These families love their dogs as
much as we do, but they are also exceptionally poor.” Even
when owners surrender their dog due to the pet’s behaviour,
animal shelter staff have learned that the problem is often the
owners’ lack of basic training to improve their pet’s behaviour.
These discoveries have been a wake-up call for animal
shelters. Along with finding new homes for surrendered
dogs, shelters now also focus on strategies that enable ownl
Inspired by the work of Downtown Dog Rescue in Los
Angeles, ACC now takes a dramatically different approach to dog
surrenders. Instead of answering a few questions asked by busy
front desk staff, owners who intend to surrender their dogs are
now greeted by trained ACC admission counsellors with impeccable people skills. In a private office, these counsellors listen to
the owner’s story about why they want or need to surrender their
dog. These counsellors are trained by licensed social workers to
maintain a nonjudgmental attitude toward the owners and to handle difficult situations. “Once that person (the pet owner) doesn’t
feel like they’re going to be judged in that moment, they might
open up and tell you the real situation,” says Simpson.
Based on the information from these conversations, ACC
counsellors direct some owners to support groups that can provide assistance, such as financial support or temporary lodging
for the dog. In other situations, the owners are invited to attend
brief training programs where they receive instruction on how
to improve the pet’s behaviour. The conversations also help
counsellors determine which pets are better off with new owners. As new situations arise, ACC staff have found increasingly
Additional Cases
T m
k r e joys wo ing u doors t r us imes in t e
he i op r the a m s
O r i al he
u t n
While minimizing unnecessary jargon, Canadian Organizational
Behaviour assists the learning process by spotlighting key
terms and providing brief definitions for them Also look for
the learning objectives presented at the beginning of each
chapter and linked to chapter content by numbered icons An
excellent study tool!
s Summarize
n nst leth, pc ospecto
ni an
n qu ,cesnd
of j bodogical
ssat f f ctelontec
as wel
h043 1Parker is a ge log
a tm
d field
niz cal ield f t ch
t )i ian m
e res s a
son s
ua io of he j a d
e e
o easpec of
zedrkn o ledt nd texpe
ini allt nteohnical
p tr
u i g
g la e tting a d
(e i a temp ng o ch n
he di atisfying s uatio (vo ce),
gr d i stal tio , soil ampling pro pe ting nd trenching
e ducin pwork
s e for and
ir performance
(ne ect). Job sa gis action
a sistants df r tal reloft A ticp Mi ing Con mtants’ progr
w ms
Fieo dea s st nt oa eApaid iaefairg n lo odai yowagi m(n ma tety)
hos t l e e ploy
he e’s kemoti i nal
h at bhm nt t o 12d tific) io d w
a t
p o didi d me s and aacc mm dot o
con inuance comm tmen whi h is
g uti
ter p , t
r gh three st ges: l rm, sis an e and exha stio
1 d 0take th
an discussed the j b—h wnl l ng i wou
h t pl
ph cal o mo i n l ma
per on
r obe mor
r orga
ti n ol
ing spo
a d ea pl
that might
di zcult
t wi
ee ok
ob eve yo e would ha e o av r e s ven a d a ha
y v
e r l atee hssof you
clai tifb fov and to
I m confident
b e fyit. And ntt sn na oraa ab
w ek. f aw ag
h -jo
t n then ’re ov
$3 ng bt e str fsso with
h r wi ” T om
i lar l Terms
f whom had
th flagg organizational
ng tape nd azes
s) itudes
0 metresd(calle
most 1 0 kicommitment
ome res o
ven days intelligence
p us mob lizatio
job. Thislabour
y ,
gt voice hloyalty
y. neglect
o ow
ng is model
r n
,g th enking
ad that
pt they
i n sywould
d mde
job satisfaction
AY 3 of reciprocity
rvice ompl
prof t ted
f ve
at bot
s es thre
t ustr
k l f iand
t gratio
at Millar
Class Exercise:
Purpose This exercise is designed to help you understand
the contingencies of employee involvement.
Instructions (Small or Large Class) Four scenarios are
presented in this exercise. Assume you are the manager or
person in charge. For each scenario, identify the preferred
level of employee involvement from one of the five levels
described below. For each scenario, identify and justify what
factors led you to choose this level of employee involvement
rather than the others. Also, be prepared to discuss what
problems might occur with less or more involvement in this
case (where possible).
1. Decide alone. Use your personal knowledge and insight
to complete the entire decision process without conferring with anyone else.
department employs about 300 people who are responsible
for constructing and maintaining water lines throughout the
city. Although you have an engineering background, the
work is complex and involves several professions and trades.
Even the TD group’s first line supervisors (one or two levels
below you in the hierarchy) are not fully knowledgeable of
all aspects of the business.
You believe that most employees support or at least accept
the city’s recent mandate to reduce costs (called the “productivity dividend initiative”). The city leaders have stated that
this initiative will not result in any layoffs this year. However,
the labour union representing most nonmanagement staff in
the water agency (including most of your employees) is concerned that the productivity dividend initiative will reduce
employment numbers over time and increase employee
Self-Assessments for Chapter 3
How much does work define
your self concept?
Work is part of our lives Some people view work as central to their identity as individuals, whereas
others consider work to be secondary to other life interests This self assessment estimates the extent
to which work is central to your self concept
How much general
self efficacy do you have?
Self efficacy refers to a person s belief that they have the ability, motivation, and resources to com
plete a task successfully Although self efficacy is often situation specific, people also develop a more
general self efficacy if they perform tasks in a variety of situations This self assessment estimates
your general self efficacy
What is your locus
of control?
Locus of control is one component of self evaluation, which is part of an individual s self concept
It is a person s general belief about the amount of control they have over life events This self assessment
estimates the extent to which you have an internal or external locus of control
How much perceptual struc
ture do you need?
Some people have a greater need than do others to quickly or completely make sense of things around
them This personal need for perceptual structure relates to selective attention as well as perceptual
organization and interpretation This self assessment estimates your personal need for perceptual
How strong is your
perspective taking
(cognitive empathy)?
Empathy refers to a person s understanding of and sensitivity to the feelings, thoughts, and situation
of others The understanding part of empathy is called perspective taking or cognitive empathy
It refers to a rational understanding of another person s circumstances This self assessment estimates
how well you cognitively understand another person s situational and individual circumstances
How strong is your
emotional empathy?
Empathy refers to a person s understanding of and sensitivity to the feelings, thoughts, and situation
of others The sensitivity part of empathy is called emotional empathy It refers to experiencing
the feelings of the other person This self assessment estimates how well you are able to experience the
emotions or feelings of another person
After reading this chapter, you should be able to:
LO1 Define employee motivation and engagement.
LO2 Explain how drives and emotions influence employee motivation.
LO3 Discuss the employee motivation implications of four-drive theory, Maslow’s needs
hierarchy, intrinsic and extrinsic motivation, and learned needs theory.
LO4 Discuss the expectancy theory model, including its practical implications.
LO5 Outline organizational behaviour modification (OB Mod) and social cognitive theory,
and explain their relevance to employee motivation.
LO6 Describe the characteristics of effective goal setting and feedback.
LO7 Explain how equity theory, procedural justice, and interactional justice influence
employee motivation.
Teaching and Learning Tools
m 2
McGraw Hill Connect® is an award-winning digital teaching
and learning solution that empowers students to achieve better
outcomes and enables instructors to improve efficiency with
course management. Within Connect, students have access to
SmartBook®, McGraw Hill’s adaptive learning and reading
resource. SmartBook prompts students with questions based
on the material they are studying. By assessing individual
answers, SmartBook learns what each student knows and
identifies which topics they need to practise, giving each student a personalized learning experience and path to success.
Connect’s key features include analytics and reporting,
simple assignment management, smart grading, the opportunity to post your own resources, and the Connect Instructor
Library, a repository for additional resources to improve student engagement in and out of the classroom.
Instructor resources for Canadian Organizational
Behaviour, Eleventh Edition:
Instructor’s Manual
Test Bank
Video Cases
Microsoft® PowerPoint® Presentations
Manager’s Hot Seat Videos
McShane Connect is a one-stop shop for instructor resources,
Instructor’s Manual: Written by the book’s authors, the
Instructor’s Manual supports instructors’ needs in many
ways. Each chapter includes the learning objectives, glossary
of key terms, a chapter synopsis, complete lecture outline,
and solutions to the end-of-chapter discussion questions. It
also includes teaching notes for the chapter case(s), team
and class exercises, and self-assessments. The Instructor’s
Manual also includes teaching notes for the end-of-text cases.
Computerized Test Bank: Updated by Michael Halinski of
Ryerson University, this flexible and easy-to-use electronic
testing program allows instructors to create tests from bookspecific items. The Test Bank contains a broad selection of
multiple choice, true/false, and essay questions and instructors may add their own questions as well. Multiple versions
of the test can be created and printed.
Video Cases: The accompanying video cases are available to
instructors through video streaming in Connect. Teaching notes
can be found in the Instructor’s Resource section in Connect.
PowerPoint® Presentations: Written by the text authors,
these robust presentations offer high-quality visuals to bring
key OB concepts to life.
Manager’s Hot Seat Videos: This resource allows students to
watch real managers apply their years of experience to management and organizational behaviour issues. Students assume the
role of the manager as they watch the video and then answer
multiple-choice questions following the segment. The Manager’s
Hot Seat Videos are ideal for group or classroom discussions.
Writing Assignments: The Writing Assignment tool delivers a learning experience to help students improve their written communication skills and conceptual understanding. As
an instructor you can assign, monitor, grade, and provide
feedback on writing more efficiently and effectively.
Test Builder
Available within Connect, Test Builder is a cloud-based tool
that enables instructors to format tests that can be printed or
administered within a Learning Management System. Test
Builder offers a modern, streamlined interface for easy content configuration that matches course needs, without requiring a download.
Test Builder allows you to:
• access all test bank content from a particular title
• easily pinpoint the most relevant content through robust
filtering options
• manipulate the order of questions or scramble questions
and/or answers
• pin questions to a specific location within a test
• choose the layout and spacing
• add instructions and configure default settings
Test Builder provides a secure interface for better protection
of content and allows for just-in-time updates to flow directly
into assessments.
Remote Proctoring & Browser-Locking Capabilities
New remote proctoring and browser-locking capabilities,
hosted by Proctorio within Connect, provide control of the
assessment environment by enabling security options and
verifying the identity of the student.
Seamlessly integrated within Connect, these services
allow instructors to control students’ assessment experience
by restricting browser activity, recording students’ activity,
and verifying students are doing their own work.
Instant and detailed reporting gives instructors an at-aglance view of potential academic integrity concerns, thereby
avoiding personal bias and supporting evidence-based claims.
Organizational behaviour is a fascinating subject. It is also
incredibly relevant and valuable, which becomes apparent while developing a world-class book such as Canadian
Organizational Behaviour, Eleventh Edition. Throughout
this project, we witnessed the power of teamwork, the excitement of creative thinking, and the motivational force of the
vision that we collectively held as our aspiration. The tight
coordination and innovative synergy was evident throughout
this venture. Our teamwork is even more amazing when you
consider that most of us in this project are scattered throughout Canada, and the lead co-author (Steve) spends most of
his time on the other side of the planet!
Portfolio Manager Amy Clarke-Spencley led the development of Canadian Organizational Behaviour with unwavering enthusiasm and foresight. Content Developer Krisha
Escobar orchestrated the daily process with superhuman skill
and determination, which is particularly important given the
magnitude of this revision, the multiple authors, the pressing
deadlines, and the 24-hour time zones in which we operated.
Photo researcher and permissions editor Monika Schurmann
wowed us with her ability and persistence in tracking down the
images and rights that we sought out. Michelle Losier created
a refreshing book design that elegantly incorporated the writing, exhibits, examples, photos, and many other resources that
we pack into this volume. We also extend our thanks to Sarah
Fulton for superb copy editing, Supervising Editor, Jessica
Barnoski, for leading the production process like a precision
timepiece, and Emily Park, for her excellent marketing and
sales development work. Thanks to you all. This has been a
truly wonderful journey!
Several dozen instructors around the world reviewed
parts or all of Canadian Organizational Behaviour, Eleventh
Edition, or related editions in the United States, Asia Pacific
region, and elsewhere since the previous Canadian edition.
Their compliments were energizing, and their suggestions
significantly improved the final product.
Steve is forever grateful to his students over the years at
Simon Fraser University, University of Western Australia,
the IMBA program at Shanghai Jiao Tong University, and
elsewhere for sharing their learning and work experiences
in his organizational behaviour classes. These interactions
have helped the development of this textbook in Canada,
the United States, and the Asia-Pacific region. Steve is
honoured to work with Kevin Tasa and Sandra Steen on
Canadian Organizational Behaviour, as well as with his
other co-authors, including Mary Ann von Glinow (Florida
International University) in the two editions in the United
States, and Mara Olekalns (University of Melbourne),
Alex Newman (Deakin University), and Angela Martin
(University of Tasmania) on the Asia-Pacific edition. He
also thanks the co-authors of other translations and adaptations. Most of all, Steve is forever indebted to his wife,
Donna McClement, and to their wonderful daughters,
Bryton and Madison. Their love and support give special
meaning to Steve’s life.
Introduction to the Field of Organizational Behaviour
After reading this chapter, you should be able to:
LO1 Define organizational behaviour and organizations.
LO2 Explain why organizational behaviour knowledge is important for you and
for organizations.
LO3 Describe the anchors on which organizational behaviour knowledge is based.
LO4 Summarize the workplace trends of diversity and the inclusive workplace, work–life
integration, remote work, and emerging employment relationships.
LO5 Describe the four factors that directly influence individual behaviour
and performance.
LO6 Summarize the five types of individual behaviour in organizations.
BlueCat Networks has developed a global reputation for its innovative, security-focused network
technology. It is recognized annually as one of the
best places to work in Canada and recently won
the Canadian HR award for having the best organizational culture.
With global headquarters nestled in a forested
North York setting, BlueCat provides subsidized
meals, town hall meetings with the executive team,
Toronto-based BlueCat Networks has become a highly
work-life integration initiatives (such as its awardsuccessful technology company by supporting teamwork
winning annual Wellness Week), ongoing training and
and collaboration, a strong organizational culture,
development, a relatively flat organizational struceffective decision making and creativity, and many other
ture, and a strong culture. “Treating our employees
organizational behaviour practices.
©BlueCat Networks
well has been core to our business philosophy,” says
CEO Michael Harris. “Providing a nurturing workplace dates back to the very beginning of BlueCat.”
BlueCat’s 400 employees participated in the process of identifying the tech firm’s five core values. “Our
winning culture is our secret sauce,” says Cheryl Kerrigan, BlueCat’s VP, People. “It differentiates us with our
customers, it guides who we hire, who we promote and how we lead.” She adds that these values are not
just words on a wall. “We really hold each other to account by making sure that we are living the five values.”
2 Part One
Effective decision making is central to BlueCat ’s success. As one employee points out: “What we do
is solve problems in some of the most cutting-edge parts of our technology space.” Risk taking is an
important part of creativity, so BlueCat supports people who try out new ideas, even if they don’t always
work. “I think it’s important to recognize people for taking risks,” says Harris. “And the most obvious way
of doing that is not to punish people who take risks and make mistakes.”
BlueCat employees also speak proudly about the company’s emphasis on teamwork and inter-­
departmental collaboration. “There are very few silos at BlueCat,” says chief financial officer Stephen
Devito. “Everybody likes to work together, and I think together we’ re much stronger than we are as an
individual.” Harris echoes this view. “[BlueCat] people are working together and going out of their way to
work together,” he observes.1
Welcome to the Field of
Organizational Behaviour!
Teamwork and collaboration. Strong organizational culture.
Effective decision making and creativity. These are just a
few of the organizational behaviour topics and practices that
have made BlueCat Networks a successful organization in a
highly competitive and dynamic environment. In every sector of the economy, organizations need to employ skilled and
motivated people who can be creative, work in teams,
and maintain a healthy lifestyle. They need leaders with foresight and vision, who support innovative work practices, and
who make decisions that consider the interests of multiple
stakeholders. In other words, the best companies succeed
through applying the concepts and practices that we discuss
in this organizational behaviour book.
Our purpose is to help you understand what goes on in
organizations. We examine the factors that make companies
effective, improve employee well-being, and drive successful
collaboration among co-workers. We look at organizations
from numerous and diverse perspectives, from the deepest
foundations of employee thoughts and behaviour (personality, self-concept, attitudes, etc.) to the macro-level interplay
among the organization’s structure, culture, and the external
environment. Along this journey, we emphasize why things
happen and what you can do to predict and guide organizational events.
We begin this chapter by introducing you to the field of
organizational behaviour (OB) and its historical o­ rigins. This
is followed by details about why OB is important for your
career and why organizations depend on OB knowledge to
survive and thrive. An integrative model of o­ rganizational
behaviour is presented, which illustrates the interconnectedness of OB topics and serves as a road map to guide
you through this book. We then describe the philosophical anchors that guide the development of organizational
behaviour knowledge. This is followed by an overview
of four emerging features of the workplace environment:
diversity and the inclusive workplace, work–life integration, remote work, and emerging employment relationships.
The latter part of this chapter introduces the MARS model,
which outlines the four direct drivers of individual behaviour
and performance. The final section identifies the five main
types of individual behaviour.
Organizational behaviour (OB) is the study of what people
think, feel, and do in and around organizations. It looks at
employee behaviours, decisions, perceptions, and emoorganizational behaviour (OB)
The study of what people
tional responses. It examines
think, feel, and do in and
how individuals and teams in
around organizations.
organizations relate to each
other and to their counterparts in other organizations. OB also encompasses the study
of how organizations interact with their external environments, particularly in the context of employee behaviour and
decisions. OB researchers systematically study these topics
at multiple levels of analysis, namely, at the level of the individual, team (including interpersonal), and organization.2
The definition of organizational behaviour begs the question: What are organizations? Organizations are groups
of people who work interdependently toward some
organizations Groups
of people who work
purpose.3 Notice that orgainterdependently toward
nizations are not buildings
some purpose.
or government-registered
entities. In fact, many organizations exist with neither physical walls nor government
documentation to confer their legal status. Organizations
have existed for as long as people have worked together.
Massive temples dating back to 3500 BCE were constructed
through the organized actions of multitudes of people.
Chapter One
Introduction to the Field of Organizational Behaviour
©Kepler Communications
Kepler Communications illustrates the power of organizations. Within its first four years in business, the Toronto-based
start-up has designed and launched two bread-box sized satellites and secured venture capital to fund several more.
These nano-satellites can transfer data much more quickly, cheaply, and efficiently than traditional satellites. “You can
think of it like routers in space,” says Mina Mitry, Kepler’s co-founder and CEO (shown in this photo). Kepler is already
competing successfully against two global juggernauts: Elon Musk’s SpaceX and SoftBank’s OneWeb. “Putting together
the right team has made our company what it is today,” says Mitry. He adds: “Innovation can only exist with a clear vision
and a good underlying motivation—that is, to make a better version of the world.”*
*T. Soper, “Startup Spotlight: Kepler Is Building Communications Infrastructure for the ‘new Space Economy,” GeekWire, May 12, 2016; J. Cowgill, “Bringing
Connectivity to Space with Kepler Communications,” Medium, October 15, 2018; A. Saltzman, “Companies Look to Cash in on Out-of-This-World Profits in
New Space Economy,” CBC News, July 17, 2019; M. Harris, “SpaceX, OneWeb, Or Kepler Communications: Who Really Launched The First Ku Band Satellite?”
IEEE Spectrum, August 29, 2019; “Kepler Communications Inc.,” accessed October 3, 2019, https://www.keplercommunications.com/company/team.
Craftspeople and merchants in ancient Rome formed guilds
with elected managers. More than 1,000 years ago, Chinese
factories were producing 125,000 tons of iron each year.
Closer to home, the Hudson’s Bay Company holds the distinction of being North America’s oldest commercial enterprise. Founded in 1670, the company was granted exclusive
control over one-quarter of North America, including most
of western Canada, for almost 200 years.4
One key feature of organizations is that they are collective entities. They consist of human beings—typically, but
not necessarily, employees—who interact with each other in
an organized way. This organized relationship requires communication, coordination, and collaboration to achieve organizational objectives. As such, all organizational members
have degrees of interdependence; they accomplish goals by
sharing materials, information, or expertise with co-workers.
A second key feature of organizations is that their members
have a collective sense of purpose. This collective purpose
isn’t always well defined or agreed upon. Companies typically
have vision and mission statements, but these documents are
sometimes out of date or don’t describe what employees and
leaders actually try to achieve. Still, imagine an organization
without a collective sense of purpose. It would be an
assemblage of people without direction or unifying force.
So whether they are creating network technology at
BlueCat or designing transportation infrastructure at Hatch
Ltd., people working in organizations do have some sense
of ­collective purpose. As Steve Jobs, the late co-founder
of Apple Inc. and Pixar Animation Studios, once said:
“A company is one of humanity’s most amazing inventions.
It’s totally abstract. Sure, you have to build something
with bricks and mortar to put the people in, but basically a
company is this abstract construct we’ve invented, and it’s
incredibly powerful.”5
Organizational behaviour emerged as a distinct field sometime around the early 1940s.6 During that decade, a few
researchers began describing their research as organizational
(rather than sociological or psychological). And by the late
1940s, Harvard University had changed the name of its MBA
human relations course to “Organizational Behaviour.”
4 Part One
Although the field of OB has relatively recent origins,
experts in other fields have been studying organizations for
many centuries. The Greek philosopher Plato (400 BCE)
wrote about the essence of leadership, and the Chinese philosopher Confucius (500 BCE) extolled the virtues of ethics
and leadership. Economist Adam Smith (1700s) discussed the
benefits of job specialization and division of labour. German
sociologist Max Weber (early 1900s) wrote about rational
organizations, the work ethic, and charismatic leadership.
Around the same time, industrial engineer Frederick Winslow
Taylor proposed systematic ways to organize work processes
and motivate employees through goal setting and rewards.7
Before becoming Canada’s longest serving prime minister, William Lyon Mackenzie King was a pioneering consultant who wrote about the need for more worker involvement
and organizational reward systems (1910s). Political scientist Mary Parker Follett (1920s) offered new ways of thinking about constructive conflict, team dynamics, power, and
leadership. Harvard professor Elton Mayo and his colleagues
(1930s and 1940s) established the “human relations” school
of management, which pioneered research on employee attitudes, formal team dynamics, informal groups, and supervisor leadership style. Telephone executive and Harvard
associate Chester Barnard (1930s) wrote insightful views
regarding organizational communication, coordination, leadership and authority, organizations as open systems, and
team dynamics.8 This brief historical tour demonstrates that
OB has been around for a long time; however, it wasn’t organized into a unified discipline until around World War II.
Why Organizational Behaviour
Is Important
In all likelihood, you are reading this book as part of a
required course in organizational behaviour. Apart from
degree or diploma requirements, why should you learn the
Throughout our careers teaching undergraduate, graduate, and executive programs, we noticed that the more
work experience students have, the more they tend to consider organizational behaviour as one of their most valued
courses. Why? Because they have learned over time that
OB is important to them, whether as technical professionals or senior executives.9 This observation is supported by
numerous surveys that ask employers to identify the most
important skills and knowledge they look for in new hires.
Technical skills are important, of course, particularly for
highly specialized jobs and professions. But the skills and
knowledge that employers tend to rank above anything
else are the topics found in this and other organizational
behaviour books.
Exhibit 1.1 lists the most important skills for new
employees identified by employers in four recent major
surveys. Every list identifies problem solving (including
analytic thinking and strategic thinking), which you will
learn about along with creativity and employee involvement in Chapter 7. The ability to work effectively in teams
(also listed as collaboration, interpersonal skills, and people management) is another top-ranked skill that employers
look for in job applicants. The team dynamics theme is fully
discussed in Chapter 8, but it also relates to several others topics, such as understanding and managing emotions
(Chapter 4), influencing others (Chapter 10), and managing
conflict (Chapter 11).
Communication, which is featured in Chapter 9, is a third
skill that employers in all four surveys identify as important for new hires. Leadership appears in three lists (in the
Most Important Skills for New Employees
Business Council of Canada
(entry-level hires list)
• Collaboration, teamwork,
interpersonal skills
• Communication skills
• Problem-solving skills
• Analytical capabilities
• Resiliency
ideas and practices discussed in this book? After all, who
ever heard of a career path leading to a “vice-president of
OB” or a “chief OB officer”? Our answer to this question
comes in two parts: why OB is important for you personally
and why OB is important for organizations generally.
National Association of
Colleges and Employers
(United States)
Bloomberg Skills Report
(United States)
Australian Institute of
• Problem solving
• Communication skills
• Communication
• Ability to work in a team
• Analytical thinking
• Leadership
• Communication (written)
• Work collaboratively
• Emotional intelligence
• Leadership
• Strategic thinking
• People management
• Strong work ethic
• Leadership skills
• Problem solving
Chapter One
Canadian survey, leadership is the second most important
for mid-level hires, but not among the top five for entrylevel hires). You will learn about the various perspectives
and ways of leading others in Chapter 12, but it is also associated with several other topics, such as motivating people (Chapters 5 and 6) and leading organizational change
(Chapter 15). Overall, these and other surveys suggest that
OB offers a core foundation of knowledge and skill development for your success in organizations.10
Better Personal Theories to Predict
and Influence
Along with providing the specific knowledge and skills identified in these surveys, this book serves a broader purpose:
to help you adopt better personal theories to understand,
predict, and influence organizational events. Every one of us
has an inherent drive to comprehend what is going on around
us.11 This need is particularly strong in organizations because
they are highly complex and ambiguous contexts that have
a profound effect on us. Throughout our lives, we develop
personal theories to make sense of what happens around us.
Our personal models are sometimes accurate, sometimes too
simplified to fit specific situations, and occasionally wrong.
Even some ideas that look like “common sense” may be
inaccurate or oversimplified.12
The field of organizational behaviour applies systematic
research to develop evidence-based theories. These theories
help you to refine your personal theories, so you are better
able to get things done in the workplace by predicting and
influencing organizational events.13 Organizations are people who work together to accomplish things. Therefore, no
matter what career path you choose, OB theories and practices are enormously valuable to help you perform your job
and work more effectively within organizations.
Organizational Behaviour Is for Everyone
You may have noticed that we haven’t mentioned “managers” in this discussion on why OB is important for you.
Effective management (and leadership) does depend on OB
concepts and practices, but this book pioneered the broader
view that OB is valuable for everyone who works in and
around organizations. Whether you are a software engineer,
customer service representative, foreign exchange analyst,
or chief executive officer, you need to understand and apply
the many organizational behaviour topics that are discussed
in this book. In fact, OB knowledge is probably more valuable than ever before because employees increasingly need
to be proactive, self-motivated, and able to work effectively
with co-workers without management intervention. As one
forward-thinking OB writer wrote a half-century ago: Every
employee is a manager.14
Introduction to the Field of Organizational Behaviour
Along with benefiting you as an individual, the field of organizational behaviour is vital to the organization’s survival and
success.15 For instance, the best companies to work for (i.e.,
companies with the highest levels of employee satisfaction)
enjoy significantly higher financial performance than other
businesses within the same industry. Companies with higher
levels of employee engagement have higher sales and profitability. OB practices are also associated with various indicators of hospital performance, such as lower patient mortality
rates and higher patient satisfaction. Other studies have consistently found a positive relationship between the quality of
leadership and the company’s financial performance.
Financial analysts also rely on several organizational
behaviour variables—including leadership, performance-­
based rewards, employee development, and employee
as “positive screens” for selecting companies
with the highest and most consistent long-term investment
returns. For example, a leading Canadian investment analyst identified the top five factors to consider when deciding
whether to invest in a company. First on his list was whether
the company’s “management team has great prior experience
and a vested interest in their company.”16
Almost all organizational behaviour theories have the
implicit or explicit objective of making organizations more
effective.17 In fact, organizational effectiveness is considered
the “ultimate dependent
variable” in organizational
organizational effectivebehaviour.18 Organizational
ness The extent to which an
organization has a good fit
goodness, health, competiwith its external environment,
effectively transforms inputs
tiveness, and excellence are
to outputs through human
alternative labels for orgacapital, and satisfies the
nizational effectiveness.
needs of key stakeholders.
Organizations are effective
when they have a good fit
with their external environment, effectively transform inputs
to outputs through human capital, and satisfy the needs of key
stakeholders.19 Let’s look at these elements to understand how
OB knowledge improves organizational effectiveness.
Organizations as
Open Systems
One of the fundamental
views in organizational
behaviour is that organizations are open ­systems.20
They are complex organisms that “live” within an
open systems The view that
organizations depend on
the external environment for
resources, affect that environment through their output, and
consist of internal subsystems
that transform inputs to outputs.
6 Part One
Organizations as Open Systems
External Environment
External Environment
Transforming inputs to outputs
Pur system
• Raw materials
• Human resources
• Information
• Financial resources
• Equipment
subsyste n
External Environment
external environment, as Exhibit 1.2 illustrates. The word open
describes this permeable relationship, whereas closed systems
operate without dependence on or interaction with an external
environment. Organizations depend on the external environment
for resources, including raw materials, job applicants, financial
resources, information, and equipment. The environment also
consists of laws, cultural norms, and other expectations that
place demands on how organizations should operate.
The open systems view recognizes that organizations
have numerous subsystems (departments, teams, technological processes, etc.) that transform the incoming resources
into outputs that are returned to the external environment.
Some outputs, such as products and services, may be valued by the external environment; other outputs, such as
employee layoffs and pollution, are undesirable by-products.
Throughout this process, organizations receive feedback
regarding the value of their outputs, the availability of future
inputs, and the appropriateness of the transformation process.
As open systems, organizations are effective when they
maintain a good “fit” with their external environment.21
A good fit exists when the organization’s inputs, processes,
and outputs are aligned with the resources available in the
external environment and with the needs and expectations
of that environment. Organizational behaviour knowledge is
highly relevant to the open systems view by identifying organizational characteristics that “fit” some external environments
better than others. For example, the external environment
is a key factor in choosing the best organizational structure
(Chapter 13) and organizational culture (Chapter 14). This
topic also relates to leadership (Chapter 12), organizational
change (Chapter 15), and job design (Chapter 6).
• Products/services
• Shareholder dividends
• Community support
• Waste/pollution
External Environment
OB theories also offer guidance regarding the transformation of inputs to outputs, including how internal subsystems
coordinate with one another.22 For instance, the opening case
study noted that employees at BlueCat Networks rely on teamwork and interdepartmental collaboration to more effectively
serve clients. We discuss how to create and support effective
teams (Chapter 8) and how organizations rely on a variety of
coordinating mechanisms (Chapter 13). The transformation
process also relates to how employees influence each other
(Chapter 10) and how successful companies improve coordination through a strong organizational culture (Chapter 14).
Human Capital as the Organization’s
Competitive Advantage
The most important ingredient in the organization’s process
of transforming inputs to outputs is human capital. Human
­capital refers to the knowledge, skills, abilities, crehuman capital The knowlativity, and other valued
edge, skills, abilities, creative
thinking, and other valued
resources that employees
resources that employees
bring to the organization.
bring to the organization.
It is a competitive advantage because employees are essential for the organization’s survival and success.
Furthermore, their talents are difficult to find, copy, and replace
with technology.23 Consequently, effective organizations introduce workplace practices that enhance human capital.24 These
practices are identified and discussed throughout this book.
For example, some OB themes identify ways to strengthen
employee motivation through enriched jobs, rewards, feedback, and fair work practices (Chapters 5 and 6). Other topics
Chapter One
discuss the value of employee involvement (Chapter 7) and the
features of effective self-directed work teams (Chapter 8).
Organizations potentially boost their effectiveness
through human capital development in three ways.25 First,
human capital development partly occurs by improving
employee skills and knowledge. As we will explain toward
the end of this chapter, as a person’s ability improves, their
performance tends to improve, which, in turn, improves
the organization’s success. Second, companies with superior human capital are better at adapting to rapidly changing environments. This adaptability occurs because highly
skilled employees who have freedom to perform their work
are better at performing diverse tasks in unfamiliar situations. Third, developing human capital means the company
is investing in and rewarding its workforce, which motivates
employees to reciprocate through greater effort in their jobs
and assistance to co-workers.
Organizations and Their Stakeholders
As open systems, organizations need to adjust to the evolving needs and expectations of stakeholders. Stakeholders
include customers, suppliers, the local community and
national society, interest
stakeholders Individuals,
groups, shareholders, govgroups, and other entities
ernments, and many other
that affect, or are affected by,
entities that affect, or are
the organization’s objectives
affected by, the company’s
and actions.
objectives and actions.26
Introduction to the Field of Organizational Behaviour
Organizations are more effective when they understand,
manage, and satisfy stakeholder needs and expectations.
However, this is easier said than done because stakeholders
have conflicting interests and organizations lack sufficient
resources to satisfy everyone.
Several organizational behaviour topics give us a better understanding of stakeholder relations.27 In particular,
research has identified several factors that influence the
prioritization of stakeholders, including stakeholder power
(Chapter 10), how executives perceive the organization’s
environment (Chapters 3 and 13), the organization’s culture
(Chapter 14), and the personal values of the corporate board
and executive team (Chapter 2).
Personal values play a key role in stakeholder relations.
Values are relatively stable, evaluative beliefs that guide our
preferences for outcomes or
courses of action in a variety
values Relatively stable evalof situations.28 They help us
uative beliefs that guide a
person’s preferences for outknow what is right or wrong,
comes or courses of action in
or good or bad, in a para variety of situations.
ticular situation. Chapter 2
explains how values anchor
our thoughts and, to some extent, motivate our decisions and
behaviour. With regard to stakeholders, the company’s executive team and board of directors rely on their personal values
to decide how the company should prioritize its investments
for future growth and how its current earnings should be distributed (e.g., to shareholders, employees, community, etc.).
Global Connections 1.1
MTN Group is the largest mobile telecommunications
company in Africa and a leader in corporate social
responsibility (CSR). Over the first three weeks in June,
MTN’s award-winning “21 Days of Y’ello Care” program
involves many of the company’s 19,000 employees in
various CSR events, typically focused on technology,
life skills, and community health. For example, MTN
volunteers in Nigeria recently set up digital libraries
in schools, conducted ICT and business skills training,
and raised awareness of mental wellness issues among
youth. “Our goal for this year’s Y’ello Care [program] is
to do our part to support young people and help tackle
the various issues they face,” said an executive at MTN
Nigeria of that campaign.
©REUTERS/Alamy Stock Photo
* “MTN Employees Give Back for 21 Days of Y’ello Care,” News release (Johannesburg, South Africa: MTN, May 31, 2018);“MTN Employees Empower Youth
during 21 Days of Y’ello Care,” IOL Business Report (South Africa), June 4, 2019; “MTN Employees Empower Youth during 21 Days of Y’ello Care,” The
Guardian (Lagos, Nigeria), June 20, 2019.
8 Part One
One topic that is closely aligned with personal values and
stakeholders is corporate social responsibility. Corporate
social responsibility (CSR) consists of organizational activities intended to benefit
society and the environcorporate social responsiment beyond the firm’s
bility (CSR) Organizational
immediate financial interactivities intended to benefit
society and the environment
ests or legal obligations.29
beyond the firm’s ­immediate
It is the view that compafinancial interests or
nies have a contract with
legal obligations.
society, in which they
must serve stakeholders
beyond shareholders and customers. This is known as the
triple-bottom-line philosophy. Firms that adopt the triple
bottom line aim to survive and be profitable in the marketplace (economic), but they also intend to maintain or
improve conditions for society (social) as well as the physical environment. The emerging evidence is that companies
with a positive CSR reputation tend to have better financial
performance, more loyal employees, and better relations
with customers, job applicants, and other stakeholders.30
Our discussion in the previous section not only highlights
the importance of organizational behaviour for you as well
as the organization. It also reveals that OB is a diverse and
interconnected field of knowledge. Exhibit 1.3 provides an
integrative road map to help you navigate the various organizational behaviour topics throughout this book. You might
think of this diagram as a meta-model—a model that incorporates and connects specific OB concepts, each of which
has its own explanatory models. In other words, Exhibit 1.3
gives you a bird’s-eye view of the book and its various topics, so you can more easily see how they fit together.
An Integrative Model of Organizational Behaviour
Organizational Inputs and Processes
Organizational structure
Organizational culture
Organizational technology
Inputs and Processes
Organizational change
Human resource practices
Organizational strategy
Inputs and Processes
Team tasks/size/composition
Team development/trust/cohesion
Leadership (team/organization)
Organizational citizenship
Well-being (low distress)
Team performance
Team decisions
Collaboration/mutual support
Social networks
Organizational Outcomes (Effectiveness)
Open systems fit
Effective input-output transformation
through human capital development
Effective stakeholder
Corporate social responsibility
Chapter One
As Exhibit 1.3 illustrates, individual inputs and processes
influence individual outcomes, which, in turn, have a direct
effect on the organization’s effectiveness. For example, how
well organizations transform inputs to outputs and satisfy key
stakeholders is dependent on how well employees perform
their jobs and make logical and creative decisions. Individual
inputs, processes, and outcomes are identified in the two leftside boxes of our integrative OB model and are the centre
of attention in Part 2 of this book. We will learn about personality and values—two of the most important individual
characteristics—and later examine self-concept, perceptions,
emotions, attitudes, motivation, and self-leadership.
Part 3 of this book directs our attention to team and interpersonal inputs, processes, and outcomes. These topics are found
in the two boxes on the right side of Exhibit 1.3. The chapter
on team dynamics (Chapter 8) offers an integrative model for
that specific topic, which shows how team inputs (e.g., team
composition, size, and other team characteristics) influence
team processes (team development, cohesion, and others),
which then affect team performance and other outcomes.
Later chapters in Part 3 examine specific interpersonal and
team processes listed in Exhibit 1.3, including communication, power and influence, conflict, and leadership.
Exhibit 1.3 illustrates that team processes and outcomes
affect individual processes and outcomes. As an example,
an individual’s personal well-being is partly affected by
the mutual support received from team members and other
co-workers. The opposite is also true: individual processes
affect team and interpersonal dynamics in organizations.
For instance, we will learn that self-concept among individual team members influences the team’s cohesion.
Introduction to the Field of Organizational Behaviour
The top area of Exhibit 1.3 highlights the macro-level
influence of organizational inputs and processes on both
teams and individuals. These organizational-level variables
are mainly discussed in Part 4, including organizational
structure, organizational culture, and organizational change.
However, we will also refer to human resource practices,
information systems, and additional organizational-level
variables throughout this book where they have a known
effect on individual, interpersonal, and team dynamics.
Anchors of Organizational
Behaviour Knowledge
Earlier, we pointed out that the field of organizational
behaviour benefits you because it offers carefully constructed
and tested theories and practices. By offering relatively accurate models of reality, OB helps you to refine your personal
theories, which makes it easier to understand, predict, and
influence organizational events. The field of OB relies on
a set of basic beliefs (see Exhibit 1.4). These conceptual
anchors represent the principles on which OB knowledge is
developed and refined.31
A key feature of OB knowledge is that it should be based
on systematic research, which typically involves forming
research questions, systematically collecting data, and
Anchors of Organizational Behaviour Knowledge
Systematic research
Study organizations using systematic research
Practical orientation
Ensure that OB theories are useful in organizations
Import knowledge from other disciplines, not just
create its own knowledge
Recognize that the effectiveness of an action may
depend on the situation
Multiple levels of
analysis anchor
Understand OB events from three levels of
analysis: individual, team, organization
Part One
testing hypotheses against those data.32 The Appendix at
the end of this book provides a brief overview of these
research methods. Systematic research investigation supports evidence-based management, which involves making decisions and taking
actions guided by research
evidence-based management The practice of making
evidence. It makes perdecisions and taking actions
fect sense that managebased on research evidence.
ment practice should be
founded on the best available systematic knowledge. Yet corporate leaders and others often embrace fads, untested consulting models, and
their own pet beliefs without bothering to find out if they
actually work!33
One reason why corporate decision makers overlook
evidence-based knowledge is that they are bombarded with
ideas from consultant reports, popular business books, newspaper articles, and other sources, which makes it difficult to
figure out which ones are based on solid evidence. In contrast, OB and other business school research receives limited
attention in newspapers and other public sources.34 A second reason is that good OB research is necessarily generic;
it is rarely described in the context of a specific problem in
a specific organization. Decision makers therefore have the
difficult task of figuring out which theories are relevant to
their unique situation.
A third reason is that popular management fads lacking
research evidence gain popularity because the sources of
these fads are rewarded for marketing their ideas, not for
testing to see if they actually work. Fourth, human beings
are affected by several perceptual errors and decision-­
making biases, as we will learn in Chapter 3 and Chapter 7.
For instance, decision makers have a natural tendency to
look for evidence that supports their pet beliefs and ignore
evidence that opposes those beliefs.
OB experts have proposed a few simple suggestions to
create a more evidence-based organization.35 First, be skeptical of hype, which is apparent when so-called experts say
the idea is “new,” “revolutionary,” and “proven.” In reality,
most management ideas are adaptations, evolutionary, and
never “proven” (science can disprove, but never prove; it can
only find evidence to support a practice). Second, the company should embrace collective expertise rather than rely on
charismatic stars and management gurus. Third, stories provide useful illustrations and possibly preliminary evidence
of a useful practice, but they should never become the main
foundation to support management action. Instead, rely on
more systematic investigation with a larger sample. Finally,
take a neutral stance toward popular trends and ideologies.
Executives tend to get caught up in what their counterparts at
other companies are doing without determining the validity of
those trendy practices or the relevance to their organizations.
One of the core anchors of organizational behaviour is that
knowledge must be built on a solid foundation of scientifically based research. This evidence-based management
approach embraces scientific methods. It also advises corporate leaders to become more aware of evidence-based
knowledge, and to use diagnostic tools (such as surveys
and checklists) to apply those principles in the workplace.
It seems obvious that we should rely on good evidence
rather than bad evidence (or no evidence at all) to make
good decisions in the workplace. Yet there is another side
to this debate. The question isn’t whether good evidence
is valuable; it is about the meaning of “good evidence.”
One concern is that scholars might be advocating an interpretation of good evidence that is far too narrow.* They
typically limit evidence to empirical correlational research,
whereas descriptive and qualitative information often provide additional evidence, and occasionally the only feasible evidence. A half-century ago, sociologist William Bruce
Cameron warned against this empiricist bias with this
memorable chiasmus: “Not everything that can be counted
counts, and not everything that counts can be counted.”**
Another concern is that managers don’t view organizational research as particularly relevant to the issues they
face.*** Much university research is derived from cross-­
sectional surveys that depend on uncontaminated, quantifiable measures. But managers say they need research
that is closer to real-world variables and conditions.
Unfortunately, only about 2 percent of organizational studies are real-world experiments, mainly because these field
studies take more time and are usually empirically messy,
which may make them more difficult to get published.****
A third concern is that systematic elements of organizational research studies (e.g., sample size, measurement
reliability, advanced data analysis methods) can mask other
potentially serious underlying faults. Cross-cultural studies,
for instance, often use college student samples to represent an entire culture. Lab studies with students assume
they replicate workplace conditions, yet ignore important
Chapter One
differences with employee characteristics. These and
many other faults may explain why replicated studies often
produce different results from the original. And even if the
published research is valid, the collective knowledge is
Introduction to the Field of Organizational Behaviour
still somewhat inaccurate because studies with nonsignificant results are much less likely to get published (partly
because authors don’t bother to submit papers with nonsignificant findings).*****
* M.A. Cronin and R. Klimoski, “Broadening the View of What Constitutes ‘Evidence,’” Industrial and Organizational Psychology 4, no. 1 (2011): 57–61; P.E. Spector
and L.L. Meier, “Methodologies for the Study of Organizational Behavior Processes: How to Find Your Keys in the Dark,” Journal of Organizational Behavior 35,
no. 8 (2014): 1109–19; K. Morrell and M. Learmonth, “Against Evidence-Based Management, for Management Learning,” Academy of Management Learning &
Education 14, no. 4 (2015): 520–33.
** W.B. Cameron, Informal Sociology: A Casual Introduction to Sociological Thinking (Random House, 1963), 13; “Not Everything That Counts Can Be Counted–
Quote Investigator,” May 26, 2010, https://quoteinvestigator.com/2010/05/26/everything-counts-einstein/.
*** J.M. Bartunek and S.L. Rynes, “Academics and Practitioners Are Alike and Unlike: The Paradoxes of Academic–Practitioner Relationships,” Journal of Management
40, no. 5 (2014): 1181–1201, https://doi.org/10.1177/0149206314529160; S. Johnson and K. Orr, “What Is Business School Research for? Academic and Stakeholder
Perspectives, Politics and Relationality,” Studies in Higher Education 0, no. 0 (2019): 1–22, https://doi.org/10.1080/03075079.2018.1564901.
**** J. Greenberg and E.C. Tomlinson, “Situated Experiments in Organizations: Transplanting the Lab to the Field,” Journal of Management 30, no. 5 (2004):
703–24;W. Zhang, A. Levenson, and C. Crossley, “Move Your Research from the Ivy Tower to the Board Room: A Primer on Action Research for Academics,
Consultants, and Business Executives,” Human Resource Management 54, no. 1 (2015): 151–74.
***** A. Franco, N. Malhotra, and G. Simonovits, “Publication Bias in the Social Sciences: Unlocking the File Drawer,” Science 345, no. 6203 (2014): 1502–05; G.C.
Banks, S. Kepes, and M.A. McDaniel, “Publication Bias: Understanding the Myths Concerning Threats to the Advancement of Science,” in More Statistical and
Methodological Myths and Urban Legends, ed. C.E. Lance and R.J. Vandenberg (New York: Routledge, 2015), 36–64. On the uneven replication of research, see:
Open Science Collaboration, “Estimating the Reproducibility of Psychological Science,” Science 349, no. 6251 (2015): 943, aac4716–1–aac16–8; C.J. Anderson
et al., “Response to Comment on ‘Estimating the Reproducibility of Psychological Science,’” Science 351, no. 6277 (2016): 1037c. Even meta-analyses might
not be the magic solution to research bias and variability. See:J. Vrieze, “Meta-Analyses Were Supposed to End Scientific Debates. Often, They Only Cause More
Controversy,” Science, September 18, 2018, https://doi.org/10.1126/science.aav4617.
Organizational behaviour doesn’t just develop theories for
the sake of being interesting. Most OB theories need to be
useful in practice, whether for executive teams or for the rest
of us in everyday work activities. This is consistent with our
statement earlier in this chapter that almost all organizational
behaviour theories have the implicit or explicit objective of
making organizations more effective. OB experts have had
a number of debates on this matter, particularly whether the
high degree of methodological rigour demanded in some
publications conflicts with, rather than supports, the relevance of that research.36
The true “impact” of an OB theory is how well it finds
its way into organizational life and becomes a valuable
asset for improving the organization’s effectiveness. For
instance, the MARS model (introduced later in this chapter) is a useful framework for coaching employees, a diagnostic tool for determining how a work issue occurred, and
a guide for implementing some forms of organizational
change. Other chapters offer specific advice on how to
energize employees, improve customer service through
employee attitudes, create more effective teams, determine
the best communication channel for a specific situation,
build a strong corporate culture, determine when to involve
others in your decisions, handle conflict effectively, and so
forth. After reading this book, you will have a toolkit of
theories that are not only interesting, but are practical to use
in organizations.
Another organizational behaviour anchor recommends that
the field should welcome theories and knowledge from
other disciplines, not just from its own isolated research
base. For instance, psychological research has aided our
understanding of individual and interpersonal behaviour.
Sociologists have contributed to our knowledge of team
dynamics, organizational socialization, organizational
power, and other aspects of the social system. OB knowledge
has also benefited from knowledge in emerging fields such
as communications, marketing, and information systems.
This practice of borrowing theory from other disciplines
is inevitable. Organizations have central roles in society, so
they are studied in many social sciences.37 Furthermore,
organizations consist of people who interact with one
another, so there is an inherent intersection between OB
and most disciplines that study human beings. However, by
relying too much on theories developed in other fields, OB
faces the risk of lagging rather than leading in knowledge
production. In contrast, OB-bred theories allow researchers
to ­concentrate on the quality and usefulness of the theory,
and be the first to understand and apply that knowledge.38
People and their work environments are complex, and the
field of organizational behaviour recognizes this by stating that the effect of one variable on another variable often
depends on the characteristics of the situation or people
Part One
involved. In practice, this means that a single outcome or
solution rarely exists; a particular action may have different
consequences under different conditions.39 For example, later
in this chapter we discuss how the success of remote work
(e.g. telecommuting) depends on specific characteristics of
the employee, job, and organization. Contingencies are identified in many OB theories, such as the best leadership style,
the best conflict-handling style, and the best organizational
structure. Of course, it would be so much simpler if we could
rely on “one best way” theories, in which a particular concept or practice has the same results in every situation. OB
experts do try to keep theories as simple as possible, but the
contingency anchor is always on their minds.40
Organizational behaviour recognizes that what goes on in
organizations can be placed into three levels of analysis:
individual, team (including interpersonal), and organization.
In fact, advanced empirical research carefully identifies the
appropriate level of analysis for each variable in the study
and then measures at that level of analysis. For example,
team norms and cohesion are measured as a team variable,
not as a characteristic of individuals within each team.
Although OB research and writing pegs each variable
within one of these levels of analysis, most variables are
understood best by thinking of them from all three levels of
analysis.41 Communication is located in this book as a team
(interpersonal) process, for example, but it also includes individual and organizational processes. Therefore, you should
try to think about each OB topic at the individual, team, and
organizational levels, not at just one of these levels.
The Emerging Workplace Landscape
Organizations are experiencing unprecedented change.
Global competition, rapid and disruptive technological
change, and many other factors have substantially altered
©i viewfinder/Shutterstock
Supporting workforce diversity and inclusiveness is a top priority at the Vancouver Airport Authority (YVR). “At YVR, we truly
believe in inclusiveness—that everybody should be able to fly and enjoy the world and, in the same way, that everybody
should be able to have a great career working at the airport,” says a YVR executive. The organization holds regular diversity
awareness courses, hosts career fairs for people with disabilities, and distributes information about job openings to
dozens of outreach groups. YVR’s executive team sets specific hiring targets for women, Indigenous peoples, persons with
disabilities, and members of visible minorities. YVR also has a well-established women in management program. Women
now represent more than 40 percent of YVR’s managers and more than half of its executives and board members.*
**“Top Employer: Vancouver Airport Authority —Recognized as One of Canada’s Best Diversity Employers (2019),” BC’s Top Employers 2019, February 21,
2019, https://content.eluta.ca/top-employer-vancouver-airport; “Vancouver Airport Authority Selected as One of Canada’s Best Diversity Employers and
One of BC’s Top Employers,” News Release (Vancouver: Vancouver Airport Authority, March 1, 2019); C. Richmond, “Need Employees? Talk to Someone
with a Disability,” Vancouver Airport Authority, CEO’s Corner (blog), September 25, 2019, http://www.yvr.ca/en/blog/2019/ceo-corner-september-2019; “Top
Employer: Vancouver Airport Authority,” accessed October 5, 2019, https://content.eluta.ca/top-employer-vancouver-airport.; “Diversity,” Vancouver Airport
Authority, 2019, http://www.yvr.ca/en/passengers/careers/diversity.
Chapter One
business strategy and everyday workplace activities. The
field of organizational behaviour plays a vital role in guiding organizations through this continuous turbulence. In this
section, we look at four emerging workplace developments:
diversity/inclusive workplaces, work–life integration, remote
work, and employment relationships.
An important objective of successful Canadian organizations
is to create an inclusive workplace. Organizations that support an inclusive workplace
view diversity as a valued
inclusive workplace A workresource. They value people
place that values people of all
identities and allows them to
of all identities and allow
be fully themselves while conthem to be fully themselves
tributing to the organization.
while contributing to the
organization.42 At the individual level, an inclusive workplace enables people, irrespective of their backgrounds, to feel psychologically safe,
engaged, valued, authentic, listened to, and respected. At a
collective level, an inclusive workplace gives diverse groups
voice through formal structures, such as diversity councils,
and everyday processes, such as representation in teams and
casual gatherings. It also continually assesses recruitment,
rewards, social and information networks, and other organizational systems to ensure that they do not unfairly favour
some groups over others.
When diversity is mentioned, most people initially think
about surface-level diversity, that is, the observable demographic and other overt differences among members
surface-level diversity The
of a group, such as their
observable demographic or
physiological differences in
race, ethnicity, gender, age,
people, such as their race,
and physical capabilities.43
ethnicity, gender, age, and
Surface-level diversity in
physical disabilities.
Canada and many other
countries has increased
substantially over the past few decades. For instance, more
than 22 percent of Canadians currently belong to a “visible
minority” group, up from 19 percent in 2011, 16 percent in
2006, 13 percent in 2001, and just 5 percent in 1981. South
Asian, Chinese, Black, and Filipino are the four largest visible minority groups in Canada.44
Diversity also includes differences in personalities, beliefs,
values, and attitudes.45 We can’t directly see this deep-level
diversity, but it is evident
deep-level diversity
in a person’s words, deciDifferences in the psychologsions, and actions. Deepical characteristics of employlevel diversity is revealed
ees, including personalities,
when employees have
beliefs, values, and attitudes.
Introduction to the Field of Organizational Behaviour
and attitudes about the same situation (see Chapter 11) and
when they form like-minded informal social groups (see
Chapter 8). Some deep-level diversity is associated with
surface-level attributes. For example, studies report significant differences between men and women regarding their
preference of conflict-handling styles, ethical principles,
and approaches to communicating with other people in
various situations.46
An example of diversity that has both surface-level and
deep-level characteristics is the multigenerational workforce.47 Exhibit 1.5 illustrates the distribution of the Canadian
labour force by major generational cohorts: Silents (born earlier than 1946), Baby Boomers (born from 1946 to 1964),
Generation X (born from 1965 to 1980), Millennials (born
from 1981 to 1996), and Generation Z (born after 1996).
Gen-Xers and Millennials each represent about one-third of
the current labour force.
Generational deep-level diversity does exist to some
extent, but it tends to be much more subtle than the popular press would suggest. Also, some generational differences are actually due to age, not cohort.48 One analysis of
German data over 25 years found that generational groups
held similar attitudes (importance of job success, importance of self-actualization, confidence in the future, worry
EXHIBIT 1.5 Canada’s Multigenerational
Generation X
Generation Z
This exhibit shows the percentage of the Canadian labour force in each generational cohort. Source: Based on data in Statistics Canada, “Labour Force
Characteristics by Sex and Detailed Age Group in 2018” (Ottawa: Statistics
Canada, April 5, 2019).
Part One
about job security, etc.) when they were a particular age.
An analysis of more than 100 studies also reported that
generational cohorts have a similar degree of work ethic
when they are a given age. Two studies of U.S federal government workers over time identified small generational
differences in various job attitudes, but these were trivial
compared to attitude differences within each generational
cohort. The point here is that differences in needs, expectations, and attitudes do exist across age groups, but this
deep-level diversity is due more to the person’s stage in life
and less to whether they were born into a specific cohort
(Millennial, Baby Boomer, etc.).
Consequences of Diversity
Workforce diversity offers numerous benefits.49 Teams with
high informational diversity (where members have different
knowledge and skills) tend to be more creative and make
better decisions in complex situations compared to teams
with less informational diversity. A workforce with surface- and deep-level diversity is also more representative of
most communities, so companies are better able to recognize and address community needs. Overall, inclusive workplaces produce better decisions, employee attitudes, team
performance, and a host of other favourable outcomes for
employees and the organization. However, these benefits are
contingent on a variety of factors, such as leadership, team
structure, psychological safety perceptions, and employees’
personal values.50
Diversity also poses challenges in the workplace.51 One
problem is that employees with diverse backgrounds usually take longer to perform effectively together because
they experience numerous communication problems
and create “faultlines” in informal group dynamics (see
Chapter 8). One recent study found that research teams in
the Formula 1 race car industry performed better as their
diversity (range of experience) increased to a point, but
performance was lower in highly diverse teams because
they couldn’t communicate or coordinate as well as less
diverse teams. Some forms of diversity also increase the
risk of dysfunctional conflict, which reduces information
sharing and satisfaction with co-workers (see Chapter 11).
These problems can offset the advantages of diversity in
some situations.
But even with these challenges, companies need to make
diversity a priority because surface-level diversity, as well
as some forms of deep-level diversity, are moral and legal
imperatives. Companies that offer an inclusive workplace
are, in essence, fulfilling the ethical standard of fairness in
their decisions regarding employment and the allocation of
rewards. Inclusive workplace practices improve the quality
of hiring and promotion, and increase employee satisfaction
and loyalty. Companies that create an inclusive workplace
also nurture a culture of respect that, in turn, improves cooperation and coordination among employees.
Before the digital age, most employees would finish work
after eight or nine hours at the office or factory and could separate their personal time from their employment. Few people
had complete separation of these roles, of course. Employees
either brought paperwork home or thought about workplace
issues long after their official work day had ended. Even so,
the past is a stark contrast to the situation today in which
information technology tethers a large percentage of employees to work on a 24/7 schedule. Globalization has contributed
to this blending of work and nonwork because employees
now need to be “on-call” with co-workers, suppliers, and clients who live in different time zones around the planet.
Little wonder that one feature employees value in a job
is the ability to integrate work with nonwork activities.52
Work–life integration refers to the extent to which people
are effectively engaged
in their various work and
work–life integration The
nonwork roles and have a
extent to which people are
low degree of role conflict
effectively engaged in their
various work and nonwork
across those life domains.53
roles and have a low degree
This phrase has replaced
of role conflict across those
work–life balance, which
life domains.
incorrectly implies that
work and nonwork roles
are completely separate and opposing partitions (like a balance of a scale). “There is no such thing as work–life balance,” says Lisa Sterling, executive vice president and Chief
People & Culture Officer at human resource software company Ceridian in Minneapolis and Toronto. “You’ve got to
get to a point at which work and life integrate, and you figure
out organizationally and individually how to make those two
things work together.”54
To understand work–life integration, consider that each
of us has multiple roles and associated self-concepts, such
as accountant, parent, friend, manager, and sports fan (see
Chapter 3). Work–life integration occurs by satisfying the
demands and experiencing the positive emotions of our various segments of life. These roles are inherently integrated
because the resources generated and consumed by one role
enhance or starve other roles.55 People with a fulfilling home
life, for example, develop social support, positive moods,
relaxation, and other resources that can enrich their work, as
well as other roles. Similarly, the resources gained at work—
new skills, financial rewards, feelings of success, and so
forth—contribute to home and other nonwork roles.
Unfortunately, many people don’t experience resource
enrichment across roles. Instead, the heavy demands of one
Chapter One
role deplete personal resources, which starve other roles.
Employees who spend most waking hours performing or
thinking about their job—whether at the workplace, at home,
or on vacation—have insufficient time and energy remaining for other aspects of their lives. They experience what
is widely known as work–life conflict. In summary, a person’s work roles and nonwork roles are inherently integrated
because the physical, cognitive, and emotional resources
produced or consumed by one role potentially enrich or
undermine the success and enjoyment of other roles.
Practising Work–Life Integration
How do individuals and organizations maximize work–
life integration?56 One strategy is to literally integrate two
or more roles. An increasingly popular trend is to conduct
meetings during an exercise walk. Some companies encourage staff to bring their dogs to work, which is both comforting and requires an occasional break to walk the four-legged
friend. On-site child care is a form of integration because
it allows employees to switch from work to parent roles
throughout the day. These integration efforts are not always
effective, but they illustrate that blending work and nonwork
roles is more viable than we previously understood.
A second work–life integration strategy occurs through
flexible work scheduling.57 For instance, you might remotely
attend a meeting from home in the evening with co-workers
who live in other time zones, then arrive at work late the next
morning after doing a few household chores. Organizations
also have parental and other personal leave benefits to support higher demands at home in the short term. A third
work–life integration strategy is to ensure that your various
work and nonwork roles are aligned with your personal characteristics. In other words, your job, family life, sports activities, and so forth should roughly be consistent with your
personality and values.
Although work is integrated with other life roles, a fourth
strategy is to engage in some degree of “boundary management” across those roles.58 Employees are more likely to
set aside work-free times in their private lives when they
observe this behaviour in managers. Several organizations
adopt more structured boundary management through rules
that prohibit work-related communication (except in extreme
emergencies) after the regular work day. The French government has taken this one step further: It passed legislation giving employees the “right to disconnect,” that is, they have a
legal right to ignore company messages after hours.
Introduction to the Field of Organizational Behaviour
is the most widely known variation of remote work(formerly called telecommuting or teleworking).59 Remote
work also occurs when employees are temporarily or indefinitely assigned to a client’s workplace—an arrangement
that we describe in the next section on employment relationships. Remote work is increasingly common because
employees can connect relatively easily with co-workers,
clients, and company data through various forms of information technology.
What percentage of Canadians work remotely? The number varies across surveys due to sampling problems and the
complex issue of which occupations to include or exclude
(farmers, travelling salespeople, independent contractors,
etc.).60 Statistics Canada estimates that, excluding farmers
and contractors, only 7 percent of Canadians perform some
of their paid work from home each week. In another study,
however, almost two-thirds of Canadian employers say they
allow some of their employees to work remotely, suggesting
that the actual percentage of employees occasionally working from home or cafés may be higher.
Remote working increased dramatically when the recent
COVID-19 pandemic forced businesses in Canada and elsewhere to apply social distancing and self-isolation practices.
One very large panel survey reported that 61 percent of fulltime American employees were working from home due to
COVID-19 a few weeks after it became a serious health concern (but before it first peaked). In comparison, 33 percent
of these employees were working at home two weeks earlier,
just as the social distancing and self-isolation requirements
were being introduced. Some companies, such as Optus (a
large Australian telecommunications firm), say they will
move some employee groups permanently to remote work
arrangements, even after the pandemic is over.61
Some companies employed a fully remote workforce long
before the COVID-19 pandemic motivated many employers to apply this work arrangement. Buffer, Automattic,
Emsisoft, and Sonatype have no physical head office; every
employee works at home, in cafés, or from other places of
their choosing. Most fully remote companies (also called
distributed organizations) have only a few dozen workers. But Automattic, which develops WordPress (powering one-quarter of the world’s websites), employs more
than 1,200 people across 77 countries. Approximately 50
of these “Automatticians” live and work in Canada (across
seven provinces). Automattic did have a head office in San
Francisco, but it was closed because very few employees
showed up to work there.62
Remote Work Benefits and Risks
Blending work with other life roles is particularly noticeable when employees sometimes work from home rather
than at the organization’s physical work site. This activity
In spite of its popularity among employees, remote work is a
controversial issue in the workplace because it has both benefits and risks for organizations as well as remote workers
Part One
Global Connections 1.2
When Christian Mairoll launched Emsisoft 15 years
ago in Austria, he probably didn’t imagine that the anti-­
malware company would now employ more than three
dozen people scattered around the planet and that he
would be leading them remotely from a sheep farm in
New Zealand.
During the start-up, Mairoll shunned bank loans and
venture capital funding, but didn’t have enough money
for a physical office. Instead, he contracted with software
developers remotely—the first hire was from Siberia! As
the business grew, more people were hired from different parts of the world. Today, Emsisoft is a completely
remote company with no physical head office.
“When I started doing all-remote, it was a special
thing,” says Mairoll. “As we celebrate our 15th anniversary, I’m proud to say that Emsisoft is living proof that
all-remote is a viable, effective, and sustainable business model.”
A decade after leading the business from Europe,
Mairoll decided to change his lifestyle by moving to
New Zealand. He discovered that his new time zone
overlapped nicely with the work hours of most of his
staff. He typically convenes online meetings before
6:00 a.m., when the Eastern European crew are finishing and the North American staff are halfway through
their day. By lunchtime in New Zealand, the Americans
have logged off, which gives Mairoll a few hours of free
time. During late afternoon in New Zealand, the Asian
staff have begun to work, so Mairoll checks in with them
before finishing his day.
There are numerous benefits of a fully remote
company versus requiring staff to work in one physical location, says Mairoll. “Hiring from anywhere and
everywhere allows us to access the best talent on the
planet. It’s also much easier for us to hire locals for roles
that require native speakers. . . . In addition, having staff
around the world means we can better serve our customers across different time zones.”
However, Mairoll emphasizes that a completely
remote organization requires staff who can manage
themselves without supervision. “There’s definitely the
potential to lose focus and motivation when working
from home,” he says. “You need to be able to get things
done, even if there is no immediate supervision or pressure from your team.”
Language is also an issue, but Emsisoft mainly uses
English text-based communication, which is easier for
foreign language speakers to master than spoken conversations. Another issue is building strong team cohesion. “I think it takes slightly more effort in team building
to establish strong team bonds over the Internet, but I
don’t see it as a major blocker at all,” Mairoll suggests.
©Kostenko Maxim/Shutterstock
* J. Trigwell, “What I’ve Learned about Running an All-Remote Company during 15-Years as the CEO of the World’s First All-Remote AV Company,” Emsisoft |
Security Blog(blog), November 20, 2018, https://blog.emsisoft.com/en/32308/what-ive-learned-about-running-an-all-remote-company-during-15-years-asthe-ceo-of-the-worlds-first-all-remote-av-company/; R. Chan, “How a Tech CEO Runs His 40-Employee Company from a Farm in New Zealand,” stuff.co.nz,
January 21, 2019.
(see Exhibit 1.6).63 Several contingencies also enhance and
undermine its effectiveness. One benefit is that remote workers usually experience better work–life integration because
they have more time and somewhat more control to juggle
work with family obligations. WestJet sales agent Carla
Holub, who now works from her home north of Calgary a few
days each week, praises this benefit. “It just freed up a good
two hours of my personal time being able to work from
my home office.” Work–life integration is more difficult,
however, when employees lack sufficient workspace and privacy at home and have increased family ­responsibilities on
days when they work from home.
Job applicants—particularly Millennials—identify remote
work as an attractive job feature, and turnover is usually lower
among employees who are able to work from home. Research
also indicates that remote workers have higher productivity
than other employees, likely because they experience less
stress and tend to convert some of the former commuting time
Chapter One
Introduction to the Field of Organizational Behaviour
Are you a good remote worker? You can discover how well you would adjust to remote work by
completing this self-assessment in Connect.
otential Benefits and Risks of
Remote Working
Potential Benefits
Potential Risks
• Better employee work–life
• More social isolation
• Attractive benefit for job
• Weaker organizational
• Low employee turnover
• Higher employee
• Lower team cohesion
• More stressful due to home
space and roles
• Reduced greenhouse gas
• Reduced corporate real
estate and office costs
into work time. Working remotely also improves productivity
by enabling employees to perform their jobs at times when
natural disasters, such as the COVID-19 pandemic, block
access to the office.
Due to less commuting, remote work offers considerable financial benefits for employees, including less unpaid
time travelling, vehicle use, fuel costs, and other commuting
expenses. One recent study of remote workers in southwestern
Ontario estimated savings between $8,820 and $29,426 per
year, depending on the number of days working from home
each week.64 With less commuting, remote work also benefits
society in the form of lower greenhouse gas emissions and
less need for taxpayer-funded transportation infrastructure.
Companies also benefit from lower real estate costs.
Remote work also has several disadvantages or risks.65
People who regularly or mostly work from home report
higher levels of social isolation, including weaker relationships with co-workers. They also receive less word-of-mouth
information, which may have implications for promotional
opportunities and workplace relations. Teams potentially
suffer from lower cohesion. Organizations risk having a
weaker culture when most employees work from home for
a significant part of their workweek.
The success of remote working depends on several
characteristics of the employee, job, and organization.66
Employees who work effectively from home typically have
higher self-motivation, self-organization, need for autonomy, and information technology skills. They also fulfil
their social needs more from sources outside the workplace.
Jobs are better suited to remote work when the tasks require
few resources at the workplace, the work is performed
independently from co-workers, and task performance
is measurable.
Remote work tends to be more successful when organizations reward and promote employees based on their performance rather than their presence in the office (face time).
These firms also help remote workers maintain sufficient
cohesion with their team and psychological connectedness
with the organization. This occurs through regular supportive communication with the supervisor and teammates.
In some instances, companies may need to limit the number
of days that employees work from home, such as by having special meetings or events where all employees assemble at the workplace. Visual communication channels, such
as video conferences with cameras turned on, also improve
personal relatedness.
Another rapidly evolving workplace characteristic is the
individual’s formal employment relationship with the organization.67 Historically, most workers have been in full-time,
permanent jobs (called direct employment). This relationship
assumes continuous employment (lifetime employment, in
rare cases), usually with expectations of career advancement and the organization’s investment in the employee’s
skills. An increasing percentage of employees—currently
about 13 percent in Canada—have more fragile forms of
direct employment, such as part-time, on-call, casual, and
seasonal employment.
Although direct employment still dominates the
Canadian labour market, indirect employment and self-employed contract work are the fastest growing work relationships. Indirect employment occurs when people work for an
employment agency and are temporarily assigned (temps)
or indefinitely “leased” to client firms. The global organization representing temp agencies estimates that approximately 2.8 percent of the Canadian labour force works
through temp agencies, compared to more than 9 percent
of the U.S. labour force. A recent in-depth report estimated
that there are almost 2,600 temp employment agencies in
Ontario alone.68
The rapid growth of indirect employment has occurred as
companies outsource noncore work activities, such as information technology and customer contact centres, to firms
that specialize in these services. However, some companies
Part One
have also outsourced core jobs to agencies because they
believe it will increase workforce flexibility, reduce unionization, and shift employment law obligations.
Self-employed contract work, the third type of employment relationship, has recently dominated the public’s attention because of the increasing number of freelancers in the
“gig economy.” Fifteen percent of the Canadian labour force
is self-employed, but this number likely excludes people who
do contract work as second jobs beyond their jobs as employees. One American survey reports that more than one-third
of the workforce in that country performs self-employed
contract work.69
Traditionally, a self-employed contractor represents an
independent organization that provides services to a client
organization. The emergence of Uber, Airbnb, Uber Eats,
and other branded platforms has created a less independent
form of this relationship. Some experts suggest that platform-­
based workers are closer to on-call direct employees rather
than contractors because they are dependent on the platform,
abide by its work standards, and in some instances provide
transportation, food delivery, or accommodation services
when required by the platform.70
Consequences of Emerging
Employment Relationships
Indirect employment and self-employed contract work
increase job performance under some circumstances, but
direct employment relationships tend to produce higher
work quality, innovation, and agility. This is because permanent employees tend to have lower turnover, higher
commitment, and more involvement in the company.
They also tend to receive more organizational investment
in their training, rewards, and other high-performance
work practices.
Teams that include both direct employment and agency
workers tend to have weaker social networks, which results
in less information sharing (see Chapter 10). Contract workers generally have similar levels of job satisfaction as direct
employment workers, whereas agency workers tend to have
lower job satisfaction. In fact, the presence of agency (outsourced) workers can adversely affect the satisfaction and
commitment of permanent employees in the client organization. Direct employment anchors an individual’s self-­concept
(see Chapter 3), whereas people working in outsourced/
agency and contract relationships need to discover how to
replicate this stability in their self-view and role. Finally,
organizations have a myriad of structural controls to manage
the performance of indirect and contract workers. However,
managers in client firms seem to experience more ambiguity in their roles and less discretion in their daily attempts
to guide the work of people who are technically not their
own employees.71
MARS Model of Individual Behaviour
and Performance
For most of the past century, experts have investigated the
direct predictors of individual behaviour and performance.72
One of the earliest formulas was performance = person ×
situation, where person includes individual characteristics
and situation represents external influences on the individual’s behaviour. Another frequently mentioned formula is performance = ability × motivation.73 Sometimes known as the
“skill-and-will” model, this formula elaborates two specific
characteristics within the person that influence individual
performance. Some organizational studies use the ability–
motivation–opportunity (AMO) model, which refers to the
three variables but with a limited interpretation of the situation. Along with ability, motivation, and situation, researchers have more recently identified a fourth direct predictor of
individual behaviour and performance: role perceptions (the
individual’s expected role obligations).74
These four variables—motivation, ability, role perceptions, and situational factors—are represented in the
MARS model of individual behaviour and results
MARS model A model
(see Exhibit 1.7). MARS
depicting the four variables—­
is the acronym for these
motivation, ability, role perceptions, and situational
four concepts.75 All four
factors—that directly influence
factors are essential influan individual’s voluntary
ences on an individual’s
behaviour and performance.
voluntary behaviour and
performance; if any one of
them is low in a given situation, the employee is less likely
to engage in the behaviour or will perform the behaviour
poorly. For example, motivated salespeople with clear role
perceptions and sufficient resources (situational factors) will
not perform their jobs as well if they lack sales skills and
related knowledge (ability).
Motivation, ability, and role perceptions are clustered
together in the model because they are located within the person. Situational factors are external to the individual but still
affect their behaviour and performance.76 The four MARS
variables are the direct predictors of employee performance,
customer service, co-worker collegiality, ethical behaviour,
and all other forms of voluntary behaviour in the workplace.
Let’s look at each of the four factors in the MARS model.
the forces within a person
that affect the direction,
motivation The forces
within a person that affect
the direction, intensity, and
persistence of effort for
voluntary behaviour.
Chapter One
Introduction to the Field of Organizational Behaviour
MARS Model of Individual Behaviour and Results
MARS Model
Emotions and
and results
• Task performance
• Organizational
• Counterproductive
work behaviours
• Joining/staying with
intensity, and persistence of effort for voluntary behaviour.77
Direction refers to the path along which people steer their
effort. In other words, motivation is goal-directed, not random. People have choices about what they are trying to
achieve and at what level of quality, quantity, and so forth.
They are motivated to arrive at work on time, finish a project
a few hours early, or aim for many other targets.
The second element of motivation, called intensity, is the
amount of effort allocated to the goal. Intensity is all about
how much people push themselves to complete a task. Two
employees might be motivated to finish their project within
the next few hours (direction), but only one of them puts
forth enough effort (intensity) to achieve this goal. The third
element of motivation is persistence, which refers to the
length of time that the individual continues to exert effort
toward an objective. Employees sustain their effort until they
reach their goal or give up beforehand.
To help remember these three elements of motivation,
consider the metaphor of driving a car in which the thrust of
the engine is your effort. Direction refers to where you steer
the car, intensity is how much you put your foot down on the
gas pedal, and persistence is for how long you drive toward
your destination. Remember that motivation is a force that
exists within individuals; it is not their actual behaviour.
Thus, direction, intensity, and persistence are cognitive
(thoughts) and emotional conditions that directly cause us
to move.
Employee abilities have a well-known influence on
behaviour and task performance. Ability includes both
the learned capabilities and natural aptitudes required to
the organization
• Maintaining
successfully complete a task. Learned capabilities include
the skills and knowledge that people acquire, such as through
training, practice, and other forms of learning. Learned capabilities tend to wane over time if they are not regularly put
to use. Aptitudes are the natural talents that help employees
learn specific tasks more quickly and perform them better.
For example, finger dexterity is an aptitude by which individuals learn more quickly and potentially achieve higher
performance at picking up and handling small objects with
their fingers. Employees with high finger dexterity are not
necessarily better than others at first; rather, they usually
learn the skill faster and potentially reach a higher level
of performance.78
The challenge is to match a person’s abilities with the
job’s requirements because a good match tends to increase
employee performance and well-being. One matching
strategy is to select applicants who already demonstrate
the required abilities. For example, companies ask applicants to perform work samples, provide references for
checking their past performance, and complete various
selection tests. A second strategy is to train employees
who lack specific knowledge or skills needed for the
job.79 The third person–job matching strategy is to redesign the job so that employees are given tasks only within
their current abilities. For example, a complex task might
be simplified—some aspects of the work are transferred
to others—so a new employee is only assigned tasks that
they are currently able to
perform. As the employee
ability The natural aptitudes
becomes more compeand learned capabilities
tent at these tasks, other
required to successfully comtasks are added back into
plete a task.
the job.
Part One
Mind the MARS Gap on Ability, Role Perceptions, and Situational Factors*
of 160,000 Canadian federal government
employees strongly or somewhat agree that their
job is a good fit with their skills.
of 1,001 Canadian employees
surveyed say they are motivated by their job.
of 2.2 million
employees worldwide agree that
they know what is expected of them.
of 20,000 employees surveyed
across 500 organizations say not having
the tools needed to do the job has decreased
their productivity.
of 25,000
employees worldwide strongly agree
that their managers have clearly defined
their roles and responsibilities.
*The TINYpulse 2015 Employee Engagement & Organizational Culture Report: The Era of Personal and Peer Accountability(Seattle: TINYpulse, February 2016);
Gallup Inc.,State of the American Workplace(Washington, DC: Gallup, February 23, 2017; “2018 Public Service Employee Survey: Results for the Public Service”
(Ottawa: Government of Canada, Treasury Board of Canada Secretariat, 2019); TINYpulse, “The 2019 Employee Engagement Report” (Seattle, February 22, 2019);
“Personal Achievement and Interpersonal Relations Driving Canadian Workers,” News Release (Montreal: Hamster, May 21, 2019). The sample of 20,000 in the
TINYpulse 2016 report is inferred from the sample of its 2019 report. The 2016 survey only states the number of responses (400,000).
©Andersen Ross/Blend Images LLC
Along with motivation and ability, employees require accurate role perceptions to perform their jobs well. Role perceptions refer to how clearly
people understand what is
role perceptions The
expected of them, such as
degree to which a person
understands the job duties
their job duties. These perassigned to or expected
ceptions range from role
of them.
clarity to role ambiguity.
When 7,000 employees in
a global survey were asked what would most improve their
performance, “greater clarity about what the organization
needs from me” was identified as the most important factor.80
Role clarity exists in three forms. First, employees have
clear role perceptions when they understand the specific
duties or consequences for which they are accountable. This
may seem obvious, but employees are occasionally evaluated
on job duties they were never told was within their zone of
responsibility. This lack of role clarity may be an increasing
concern as organizations move away from precisely defined
job descriptions to broader work responsibilities.
Second, role clarity exists when employees understand the
priority of their various tasks and performance expectations.
This is illustrated in the classic dilemma of prioritizing quantity
versus quality, such as how many customers to serve in an hour
(quantity) versus how well the employee should serve each customer (quality). Role clarity in the form of task priorities also
exists in the dilemma of allocating personal time and resources,
such as how much time managers should devote to coaching
employees versus meeting with clients. The third form of role
perceptions involves understanding the preferred behaviours
or procedures for accomplishing tasks. Role ambiguity exists
when an employee knows two or three ways to perform a task,
but misunderstands which of these the company prefers.
Role perceptions are important because they represent how
well employees know where to direct their effort.81 Employees
with role clarity perform work more accurately and efficiently whereas those with role ambiguity waste considerable
time and energy by performing the wrong tasks or the right
tasks in the wrong way. Furthermore, role clarity is essential for coordination with co-workers and other stakeholders.
For instance, performers at Canada’s Cirque du Soleil depend
on each other to perform precise behaviours at exact times,
such as catching each other in midair. Role clarity ensures that
these expectations are met and the performances are executed
safely. Finally, role clarity motivates employees because they
have a higher belief that their effort will produce the expected
outcomes. In other words, people are more confident exerting
the required effort when they know what is expected of them.
Individual behaviour and performance also depend on the situation, which is any context beyond the employee’s immediate
control.82 The situation has two main influences on individual
Chapter One
Introduction to the Field of Organizational Behaviour
©AP Photo/Julio Cortez
Virtual reality training is helping Walmart employees improve their knowledge, skills, and role perceptions. To experience
the chaos of a virtual Black Friday workday, one employee slips on VR goggles and acts out the role. Meanwhile, other
classmates view a projection of the same scene of long lines, confused shoppers, a toddler standing on a shopping
cart seat, and a manager searching for lost keys. The instructor tests role perceptions by asking the goggled student
and other classmates to prioritize what should be done, and to describe the preferred behaviours for each incident. For
example, Walmart has a preferred way to correct the child’s risky behaviour in the shopping cart (hint: don’t tell the child
directly). “Black Friday is a busy, hectic day for everyone,” says Sandi Hughes, a Walmart employee in St. Petersburg,
Florida. “With the VR, an associate can feel how it can play out.”*
*L. Mirabella, “Walmart Employees Get Real Look at Retail World; Virtual Reality Technology Prepares Supervisors for Situations That Might Arise,” Baltimore
Sun, December 3, 2017; H. Shively, “Area Stores Training Employees Using Virtual Reality,” TCA Regional News, November 12, 2018; S. DiNatale, “What’s It
Like to Train for Walmart’s Black Friday? Local Stores Use Virtual Reality Goggles,” Tampa Bay Times, November 13, 2018.
behaviour and performance.83 One influence is that the work
context constrains or facilitates behaviour and performance.
Employees who are motivated, skilled, and know their role
obligations will nevertheless perform poorly if they lack time,
budget, physical work facilities, and other resources. The second influence is that the work environment provides cues to
guide and motivate people. For example, companies install
barriers and warning signs in dangerous areas. These workplace features are situational factors that cue employees to
avoid the nearby hazards.
Types of Individual Behaviour
The four elements of the MARS model—motivation, ability,
role perceptions, and situational factors—affect all voluntary workplace behaviours and performance. There are many
varieties of individual behaviour, but most can be organized
into the five categories described in this section: task performance, organizational citizenship behaviours, counterproductive work behaviours, joining and staying with the
organization, and maintaining work attendance (Exhibit 1.8).
Task performance refers to the individual’s voluntary
goal-directed behaviours that contribute to organizational
objectives.84 Most jobs require incumbents to complete several tasks. For example, foreign exchange traders at RBC
Capital Markets in Toronto and elsewhere must be able to
identify and execute profitable trades, work cooptask performance The
eratively with clients and
individual’s voluntary
co-workers, assist in traingoal-­directed behaviours
ing new staff, and work on
that contribute to
special computer and other
organizational objectives.
digital equipment without
Part One
ive Types of Individual Behaviour
in the Workplace
with the
Types of
error. All tasks involve various degrees of working with people, data, things, and ideas.85 Foreign exchange traders, for
instance, mainly work with data (e.g., performing technical
analysis of trends), but also with people (e.g., sharing information with co-workers and clients) and ideas (interpreting
charts and economic reports).
There are three types of task performance: proficient,
adaptive, and proactive.86
• Proficient task performance refers to performing the
work efficiently and accurately. It involves accomplishing
the assigned work at or above the expected standards of
quality, quantity, and other indicators of effectiveness.
• Adaptive task performance refers to how well employees
modify their thoughts and behaviour to align with and
support a new or changing work process or work setting.
Essentially, adaptive task performance is about how well
employees respond to change in the workplace and in
their job duties.
• Proactive task performance refers to how well ­employees
take the initiative to anticipate and introduce new work
Global Connections 1.3
Employees with high adaptive performance are increasingly important at Daimler AG. The German automobile
giant is creating more fluid team-based structures to
keep pace with rapidly changing consumer preferences
and technological innovations. “The world we live and
work in is undergoing unprecedented change,” advises
Daimler senior executive Wilfried Porth. “Creativity,
flexibility and responsiveness are the top skills going
forward into the future.”
Daimler is shifting up to 20 percent of its employees
out of its traditional rigid hierarchy into a more fluid and
highly variable structure of temporary swarm teams.
“Swarms work autonomously, are self-organized, set
goals and roles, have complete end-to-end responsibility, and include a diverse range of people across functions and skill sets,” explains Sabine Scheunert, vice
president Digital and IT Marketing/Sales of Daimler’s
Mercedes-Benz Cars unit.
Some swarms have a dozen team members on shortterm projects; others are large-scale projects (such as
Daimler’s next-generation procurement process) that
bring together up to 80 experts from across the organization. No matter what size or duration, swarms require
members who can comfortably and efficiently adapt
their roles and membership in different swarm projects
where their skills are needed.
©Sueddeutsche Zeitung Photo/Alamy Stock Photo
* J. Brecht, “How to Make Swarms Work.,” LinkedIn, March 7, 2018, https://www.linkedin.com/pulse/how-make-swarms-work-jan-brecht; “Ready to Be
Different,” Diversity Report (Stuttgart: Daimler AG, May 24, 2018); R. Deiser, “Part 5: Agility in Practice: The Swarm Organization at Daimler,” The Digital
Transformation People (blog), May 7, 2019, https://www.thedigitaltransformationpeople.com/channels/people-and-change/agility-in-practice-the-swarmorganization-at-daimler/; Capgemini Research Institute, “Daimler: Accelerating Digital Innovation by Transforming Culture, Collaboration, and Talent:
An Interview with Sabine Scheunert, Daimler AG,” Digital Leadership (Paris: Capgemini, February 8, 2019).
Chapter One
patterns that benefit the organization. Proactive behaviours
bring about change in oneself, co-workers, and the
­workplace to achieve what is perceived to be a better
future for the organization.
Employees in almost every job are expected to perform
their work proficiently. However, adaptive and proactive task
performance are also important when the work is ambiguous or dynamic. These conditions exist when the client’s
expectations are unclear, resources to perform the work have
uncertain availability, and the methods used to perform the
work are rapidly evolving due to emerging technology.
Employee behaviour extends beyond performing specific tasks. It also includes organizational citizenship
behaviours (OCBs), which are various forms of cooperation
and helpfulness to others
that support the organizaorganizational citizenship
tion’s social and psychobehaviours (OCBs) Various
forms of cooperation and
logical context.87 Some
helpfulness to others that supOCBs are directed toward
port the organization’s social
individuals, such as assistand psychological context.
ing co-workers with their
work problems, adjusting
your work schedule to accommodate co-workers, showing
genuine courtesy toward co-workers, and sharing your work
resources (supplies, technology, staff) with co-workers.
Other OCBs represent cooperation and helpfulness toward
the organization, such as supporting the company’s public
image, offering ideas beyond those required for one’s own
job, attending events that support the organization, and
keeping up with new developments in the organization.
Some organizational citizenship behaviours are discretionary (employees don’t have to perform them), whereas
other OCBs are job requirements even if they aren’t explicitly stated in job descriptions. In fact, research suggests
that managers often evaluate performance by the employee’s organizational citizenship behaviours as much as their
task performance.88
OCBs can have a significant effect on individual, team,
and organizational effectiveness.89 High-OCB employees
receive more support from co-workers which, in turn, supports their own task performance. OCBs also increase team
performance because members depend on one another.
However, engaging in OCBs can have negative consequences.90 OCBs take time and energy away from performing tasks, so employees who give more attention to OCBs
risk lower career success in companies that reward task performance. Also, employees who frequently perform OCBs
Introduction to the Field of Organizational Behaviour
tend to have higher work–family conflict because of the
amount of time required for these activities.
Organizational behaviour is interested in all workplace
behaviours, including dysfunctional activities collectively known
as counterproductive work behaviours (CWBs). CWBs
are voluntary behaviours
that have the potential to
counterproductive work
directly or indirectly harm
behaviours (CWBs) Voluntary
behaviours that have the
the organization or its
potential to directly or indistakeholders.91 This conrectly harm the organization.
cept includes a wide array
of intentional and unintentional behaviours, such as harassing co-workers, creating
unnecessary conflict, deviating from preferred work methods
(e.g., shortcuts that undermine work quality), being untruthful,
stealing, sabotaging work, and wasting resources. CWBs are
not minor concerns; research suggests that they can substantially undermine the organization’s effectiveness.
Companies suffer and potentially fail if they can’t hire and
retain enough people with the right skills and knowledge
to perform the work.92 This isn’t a hypothetical statement.
During times of economic growth, Canadian companies
consistently identify the shortage of skilled labour as the
number-one factor limiting their ability to increase sales
or production.
The effects of staff shortages are even more dramatic
during crises, such as the coronavirus (COVID-19) pandemic. Some hospitals in Toronto were so short-staffed
due to the virus that employees who would normally enter
two-week self-isolation periods after returning from overseas were asked to immediately report for work. Quebec
found it so difficult to staff the province’s long-term care
homes during the pandemic that the federal government
sent 1,000 soldiers and dozens of military staff with medical training to temporarily assist these facilities in caring for
elderly Canadians.93
Even when companies are able to hire qualified staff in the
face of shortages, they need to ensure that these employees
stay with the company.94 Earlier in this chapter, we explained
that human capital is the organization’s main source of competitive advantage. The importance of human capital is particularly apparent when employees quit. Those who leave
remove valuable knowledge, skills, and relationships with
co-workers and external stakeholders, all of which take time
Part One
for new staff to acquire. Other problems with employee turnover are discussed in later chapters, such as its adverse effect
on customer service, team development, and corporate culture strength. Employee turnover does offer some benefits,
such as opening up positions so new employees with fresh
ideas can be hired and removing people without counterproductive work behaviours. But overall, turnover usually has a
negative effect on organizational effectiveness.
Along with attracting and retaining employees, organizations need everyone to show up for work at scheduled times.
Unscheduled absenteeism can lead to increased workloads
or overtime among co-workers, lower performance by temporary staff filling the vacant positions, poorer coordination
in the work process, poorer customer service, and potentially more workplace accidents.95 Canadian employees are
absent an average of 10 days of scheduled work each year,
including eight days due to illness or injury and two days
due to personal or family reasons. How absenteeism is calculated varies across countries, but an approximate comparison is that Americans are absent an average of four days per
year (including 2.5 days due to illness or injury) and British
employees are absent due to sickness (illness or injury) an
average of 4.1 days per year.96
What are the main causes of absenteeism and lateness?97
Much absenteeism is due to situational factors, such as personal illness, family demands (e.g., sick children), and bad
weather. Other absenteeism occurs because employees need
to get away from workplace bullying, difficult customers,
boring work, and other stressful conditions. Absenteeism is
also higher in organizations with generous sick leave because
this benefit minimizes the financial loss of taking time away
from work. Absenteeism also varies from one employee to
the next due to personal values and personality. Finally, studies report that absenteeism is higher in teams with strong
absence norms, meaning that team members tolerate and
even expect co-workers to take time off.
Although most companies focus on minimizing absenteeism,
a potentially equally serious behaviour is presenteeism—­
showing up for work when unwell, injured, preoccupied by personal problems, or faced with dangerous conditions getting to
work.98 Employees who show up for work when they should be
Global Connections 1.4
Most physicians urge sick patients to stay home, yet few
take their own advice. Three-quarters of New Zealand
doctors working in hospitals say they went to work
while unwell over the previous year. Approximately the
same percentage of Swedish doctors recently surveyed
admitted that over the previous year they had gone to
work one or more times with an illness for which they
would have advised patients to stay at home.
“Presenteeism is the elephant in the room that
nobody wants to talk or do anything about,” suggests
Michael Edmond, an executive and physician at the
University of Iowa Hospitals & Clinics. It is difficult
for medical centres to find a replacement on short
notice and many doctors feel guilty letting down their
­co-workers and patients.
“There is an unspoken understanding that you probably should be on your deathbed if you are calling in
sick,” says an attending physician at a Philadelphia
hospital where 83 percent of doctors admitted working while sick within the past year. “It inconveniences
my colleagues, is complicated to pay back shifts, and
makes me look bad to do so.”
* M.B. Edmond, “How Sick Is Too Sick to Work? Presenteeism in Healthcare,” Medscape, September 23, 2015; C. Chambers, Superheroes Don’t Take Sick
Leave, Association of Salaried Medical Specialists (New Zealand), November 2015; J.E. Szymczak et al., “Reasons Why Physicians and Advanced Practice
Clinicians Work While Sick: A Mixed-Methods Analysis,” JAMA Pediatrics 169, no. 9 (2015): 815–21; S. Marie Gustafsson, K. Schenck-Gustafsson, and A.
Fridner, “Gender Differences in Reasons for Sickness Presenteeism - a Study among GPs in a Swedish Health Care Organization,” Annals of Occupational
and Environmental Medicine 28, no. 50 (2016).
Chapter One
absent tend to be less productive and may reduce the productivity of co-workers. They may also worsen their own health and
spread disease to co-workers. This latter risk of presenteeism
had particularly serious consequences during the COVID-19
pandemic. Entire offices and production facilities shut down
after just one employee went to work while ill, which quickly
spread the virus to dozens or hundreds of other people.
Presenteeism is more common among employees with low
job security (such as new and temporary staff), employees who
lack sick leave pay or similar financial buffers, and those whose
absence would immediately affect many people. Personality,
which we discuss in Chapter 2, also motivates some people to
show up for work when others would gladly recover at home.99
The Journey Begins
This chapter gives you some background about the field
of organizational behaviour, the emerging landscape of
Introduction to the Field of Organizational Behaviour
organizations, and why OB is important for you and
for organizations. It also introduces the foundations of individual behaviour and performance as well as the main types
of individual behaviour. But this is only the beginning of
our journey. Throughout this book, we will c­ hallenge you to
learn new ways of thinking about how people work in and
around organizations. We begin this process in Chapter 2
through to Chapter 7 by looking at personality, values, and
other individual differences that indirectly predict individual behaviour through the MARS model. Next, this book
moves to the team level of analysis. We examine a model of
team effectiveness and specific features of high-performance
teams. We also look at communication, power and influence,
conflict, and leadership. Finally, we shift our focus to the
organizational level of analysis, where the topics of organizational structure, organizational culture, and organizational
change are examined in detail.
Chapter Summary
Define organizational behaviour and organizations.
Organizational behaviour is the study of what people think, feel, and
do in and around organizations. It examines how individuals and teams
in organizations relate to one another, and how organizations interact
with their external environments. This field of knowledge emerged
around the early 1940s, but organizations have been studied by other
disciplines for more than two thousand years. Organizations are
groups of people who work interdependently toward some purpose.
They consist of people who interact with one another in an organized
way and have a collective sense of purpose.
Explain why organizational behaviour knowledge is important
for you and for organizations.
Organizational behaviour is important for you because it offers a
core foundation of knowledge and skill development for your success in organizations. The skills and knowledge that employers look
for in new hires, above anything else, are the topics found in organizational behaviour, including problem solving, working e­ ffectively
in teams, communication, and leadership. More broadly, OB helps
you adopt better personal theories to understand, predict, and influence organizational events. OB knowledge is for everyone, not
just managers.
OB theories and practices are vital to the organization’s survival and success. In fact, most OB theories implicitly or explicitly try to improve organizational effectiveness—an ideal state in
which an organization has a good fit with its external environment,
effectively transforms inputs to outputs through human capital, and
satisfies the needs of key stakeholders. Organizational behaviour
knowledge is highly relevant to the open systems view of organizations by identifying organizational characteristics that “fit” some
external environments better than others. OB theories offer guidance on how to effectively transform inputs to outputs.
OB is also important for organizations because it identifies ways
for organizations to develop and leverage the potential of human
capital—the knowledge, skills, abilities, creativity, and other valued
resources that employees bring to the organization. Several organizational behaviour topics also give us a better understanding of
­relations with stakeholders—individuals, groups, and other entities that affect, or are affected by, the organization’s objectives and
actions. This latter focus includes the role of personal values (the
relatively stable, evaluative beliefs that guide a person’s preferences
for outcomes or courses of action in a variety of situations) and
corporate social responsibility (organizational activities intended to
benefit society and the environment beyond the firm’s immediate
financial interests or legal obligations).
Describe the anchors on which organizational behaviour
knowledge is based.
The systematic research anchor states that OB knowledge should
be based on systematic research, consistent with evidence-based
management. The practical orientation anchor states that OB theories need to be useful in practice, such as by helping organizations become more effective. The multidisciplinary anchor states
that the field should develop from knowledge in other disciplines
(e.g., psychology, sociology, economics), not just from its own isolated research base. The contingency anchor states that OB theories
Part One
generally need to consider that there will be different consequences
in different situations. The multiple levels of analysis anchor states
that OB topics may be viewed from the individual, team, and organization levels of analysis.
Summarize the workplace trends of diversity and the inclusive
workplace, work–life integration, remote work, and emerging
employment relationships.
An inclusive workplace values people of all identities and allows
them to be fully themselves while contributing to the organization.
It views diversity as a valued resource. An organization’s workforce
has both surface-level diversity (observable demographic and other
overt differences in people) and deep-level diversity (differences in
personalities, beliefs, values, and attitudes). Inclusive workplaces
produce better decisions, employee attitudes, team performance,
and a host of other favourable outcomes for employees and the
organization. However, diversity also poses challenges, such as dysfunctional conflict and slower team development.
Work–life integration refers to the degree that people are effectively engaged in their various work and nonwork roles and have a
low degree of role conflict across those life domains. Various work
and nonwork roles are inherently integrated because the physical,
cognitive, and emotional resources produced or consumed by one
role potentially enrich or undermine the success and enjoyment
of other roles. There are several ways to maximize work–life integration, such as by doing things that mix two roles, engaging in
flexible work scheduling, ensuring that work and nonwork roles are
aligned with your personal characteristics, and engaging in some
degree of “boundary management” across roles.
An increasing percentage of the workforce performs their jobs
remotely some or all of the time rather than at the organization’s
physical work site. Some organizations are completely remote—
everyone works at home and at cafés and the company has no physical head office. Working remotely potentially benefits employees
and employers, but there are also disadvantages. The effectiveness
of remote work depends on the employee, job, and organization.
Most of the workforce has a direct employment relationship—
working as an employee for an organization—but an increasing percentage has more fragile direct employment relationships (part-time,
on-call, etc.). The largest labour market growth has been indirect
(outsourced/agency) and contract work. Some contractors negotiate
their own contracts with the client, whereas others work through
branded platform companies (e.g., Uber). These emerging employment relationships have both positive and negative consequences for
job performance, job satisfaction, team dynamics, self-concept stability and clarity, and the ambiguity of managerial roles.
Describe the four factors that directly influence individual
behaviour and performance.
Four variables—motivation, ability, role perceptions, and situational factors—which are represented by the acronym MARS,
directly influence individual behaviour and performance.
Motivation represents the forces within a person that affect their
direction, intensity, and persistence of voluntary behaviour; ability includes both the natural aptitudes and the learned capabilities
required to successfully complete a task; role perceptions are the
extent to which people understand the job duties (roles) assigned to
them or expected of them; and situational factors include conditions
beyond the employee’s immediate control that constrain or facilitate
behaviour and performance.
Summarize the five types of individual behaviour
in organizations.
There are five main types of workplace behaviour. Task performance refers to goal-directed behaviours under the individual’s control that support organizational objectives. It includes proficiency,
adaptivity, and proactivity. Organizational citizenship behaviours
consist of various forms of cooperation and helpfulness to others
that support the organization’s social and psychological context.
Counterproductive work behaviours are voluntary behaviours that
have the potential to directly or indirectly harm the organization.
Joining and staying with the organization refers to agreeing to
become an organizational member and remaining with the organization. Maintaining work attendance includes minimizing absenteeism when capable of working and avoiding scheduled work when
not fit (i.e., low presenteeism).
Key Terms
corporate social responsibility (CSR)
counterproductive work behaviours (CWBs)
deep-level diversity
evidence-based management
human capital
inclusive workplace
MARS model
open systems
organizational behaviour (OB)
organizational citizenship behaviours (OCBs)
organizational effectiveness
role perceptions
surface-level diversity
task performance
work–life integration
Chapter One
Introduction to the Field of Organizational Behaviour
Critical Thinking Questions
1. A friend suggests that organizational behaviour courses
are useful only to people in management careers.
Discuss the accuracy of your friend’s statement.
2. Problem solving, teamwork, communication, and
­leadership are four of the top skills identified by ­employers
as most important when hiring (see Exhibit 1.1). How
have these skills been important (or unimportant) for
you in jobs that you have held or as a student? Identify
one other skill that you would place at or near the top
of the list for working effectively in organizations.
3. A young college or university student from Canada is
interested in doing international business across China,
India, Brazil, and Russia. Discuss how the knowledge
of OB can be useful to the student.
4. A common refrain among executives is “People are
our most important asset.” Relate this statement to how
organizational behaviour theories and practices improve
organizational effectiveness through human capital.
5. Corporate social responsibility is one of the hottest
issues in corporate boardrooms these days, partly
because it is becoming increasingly important to
employees and other stakeholders. In your opinion,
why have stakeholders given CSR more attention
recently? Does abiding by CSR standards potentially
cause companies to have conflicting objectives with
some ­stakeholders in some situations?
6. What does evidence-based management mean?
Describe situations you have heard about in which
companies have practised evidence-based management,
as well as situations in which companies have relied on
fads that lacked sufficient evidence of their worth.
7. Work–life integration is one of the most important
issues that job applicants consider when choosing where
to work. Think about the variety of ­specific ­benefits,
working conditions, or resources that ­employers offer
to support work–life integration. Which of these is most
valuable to you personally at this stage in your life and
career? Why? In what ways have you personally been
able to minimize conflict between your work (including
school) and nonwork roles?
8. Emsisoft and Automattic are completely remote
(­distributed) companies. Everyone who works for these
firms performs their jobs from home or cafés. In your
opinion, will distributed companies become more
­common in the future? Why or why not? Would you
prefer working in a remote company—one that has no
physical location, just (maybe) an occasional gathering
of staff at a conference setting or resort? Or do you
­prefer working face-to-face with co-workers most days
at a company work site? Why?
9. A federal government department has high levels of
absenteeism among the office staff. The head of office
administration argues that employees are misusing the
company’s sick leave benefits. However, some of the
mostly female staff members have explained that family
responsibilities interfere with work. Using the MARS
model, as well as your knowledge of ­absenteeism
behaviour, discuss some of the possible reasons for
absenteeism here and how it might be reduced.
10. Why might employees display presenteeism? What can
organizations do to reduce presenteeism and how e­ thical
are these strategies?
Case Study:
by Steven L. McShane, University of Newcastle (Australia)
Most companies try to create a safe work environment, but
few are as dedicated as Mother Parkers Tea & Coffee Inc.
As North America’s largest private-label coffee producer,
the Canadian company infuses safety knowledge, awareness,
and engagement in every employee and contractor. “One of
our priorities here has been to provide a safe workplace to
our employees,” says Adrian Khan, Mother Parkers’s Senior
Manager of Environmental, Health, Safety, and Security for
North America. “They make a commitment to us to help produce great quality products; we make a commitment to them
to provide them with a safe working environment.”
To begin with, Mother Parkers creates a physically safe
work environment through well-designed barriers and cues
at its award-winning automated production facilities in
Part One
Mississauga, Ontario, and Fort Worth, Texas. The production floor includes physical barriers to separate people from
moving equipment. Safe walking areas are brightly marked,
including specific spots where people must stop and look both
ways before crossing forklift travel areas. At eye level next to
doors are signs specifying what equipment (shoes, eyewear,
etc.) must be worn before entering the next area. Updated
lighting systems provide superior visibility and eye comfort.
Another way that Mother Parkers supports safe behaviour is
by investing in employee training. Staff learn safety procedures
before they are allowed to enter the production floor. They also
learn about new safety technology and practices from community experts at special ­health-and-safety-day events.
Employee involvement is an important part of safety
improvement at Mother Parkers. Employees participate in
safety issues so decisions are based on a full complement of
knowledge from employees, not just from management and
outside experts. “We wanted to empower the operators to
recognize hazards in their work area, voice those concerns,
and to be a part of the solutions,” says Khan, who recently
won a national safety leadership award. “When it comes
down to it, they are the experts running the machines who
know exactly what the hazards are in the workplace.” For
example, when the company decided to buy an ergonomic
roll lifter (a machine that holds and transports heavy rolls
of metal), employees on the ergonomics team tested many of
the roll lifters on the market to determine which one was the
best fit for their application.
Mother Parkers has held numerous “ergonomic blitzes,”
whereby an external consultant and production staff conduct
an intensive review of health and safety concerns in each
specific work area. “We jump-started our program by having ergonomics blitz events so that the team could ‘Find It’
(hazards), ‘Fix It’ (countermeasures), and ‘Check It’ (happy
operators),” says Khan. “From there, the team would have a
number of short-term solutions that could be implemented
immediately, and also a list of longer-term improvements
that could be planned for.”
A special cross-functional team developed from these
“ergo blitzes,” whose members now serve as role models for
safety behaviour and as valuable sources of safety knowledge. “This creates a go-to group of operators on the floor
that their peers feel comfortable with and can go to if they
want to report an issue,” Khan observes.
Employee involvement also generates employee commitment to safety. “There’s a high level of engagement here,”
says a Mother Parkers production manager. “The operators
have been developing most of the procedures for equipment
operation, cleaning, quality checks, and troubleshooting.
The operators take ownership of their positions.” Mike Bate,
Mother Parkers’s vice-president of human resources, notes
that employees are more motivated to act safely because
the company pays attention to their ideas. “Our health and
safety committees are now engaged, they have plans, they
have ideas, people’s voices get heard. And when they bring
issues on the table, those issues get dealt with and they get
addressed and they are part of the planning process.”
Another way that Mother Parkers promotes workplace
safety is by continuously reminding everyone that safety is
an important part of everyone’s job. This message occurs
through ongoing safety training, employee involvement in
ergonomic risk prevention, and the presence of numerous
workplace safety cues. Reminding everyone about safety
is even a daily event. “Safety is the core of everything
we do here,” explains the production manager of Mother
Parkers’s award-winning RealCup operations. “We begin
our production meetings and shift handovers by talking
about safety.”
Safety-focused expectations also extend to contractors, all
of whom complete a safety training program before their projects begin. “We set expectations and standards with contractors before they come on site on what it means to be on site
at Mother Parkers from a health and safety perspective,” says
Mike Bate. “Before they even get approved to come on site
and work with us as a contractor [they have to] register themselves to say they have gone through this education. So by the
time they arrive, [contractors] understand the risks, they bring
the proper protective equipment that may be required, or they
understand what they need from us to make the workplace safe
for them to work in.”
Discussion Questions
1. Apply the MARS model to explain how Mother Parkers
improves safety in the workplace.
2. What other organizational behaviour topics are ­generally
apparent in this description of how Mother Parkers
­creates a safe workplace?
Chapter One
Introduction to the Field of Organizational Behaviour
Class Exercise:
by Steven L. McShane, University of Newcastle (Australia)
Purpose This exercise is designed to help you understand
organizational behaviour issues that arise in the emerging
workplace landscape, particularly regarding inclusive workplace, remote work, and emerging employment relationships
(agency and contract workers).
Materials The learning space should allow for one large
table or other dedicated area for every 10 or so students in
the class. One person at each table (the “scribe”) should have
some means (e.g., paper/pencil, computer/tablet) of documenting ideas presented.
Step 1: Students are organized into teams of approximately
10 people. Each team is initially assigned to a large table or
dedicated space for the team. The instructor will assign one of
the three themes (see below) to each table. For example, if the
class has 60 students, there would be six tables of 10 students.
Two tables would be assigned the theme of inclusive workplace,
two tables would look at remote work, and two tables would
look at employment relationships (agency/contract work).
Step 2: One person on each team volunteers to be the “scribe”
for that table. Throughout the exercise, the scribe documents
the main ideas presented by students who attend that table.
The scribe remains at that table for the entire exercise (other
team members will move to other tables during the exercise).
All scribes will later debrief the class on the key points they
documented on the theme assigned to their table.
Step 3: Teams will read the questions assigned to the theme
of their initial table (see below). They have a fixed time
(­usually between 10 and 15 minutes) to discuss their views
and offer answers to those questions.
Step 4: After the preset discussion time has ended, the instructor will direct students at each table (except the scribe, who
remains at the table) to another table that has a different theme.
For example, students at a “remote work” table would move to
a table assigned the “agency/contract work” or “inclusive workplace” theme. Students will read the questions assigned to the
theme of this second table. The instructor again assigns a fixed
time (10–15 minutes) for students to discuss their new theme.
Step 5: The scribe will add the ideas presented by the second
group to those provided by the first group. The scribe should
not tell the second group what the first group discussed about
this theme. The scribe should remain quiet, except for asking
for clarification.
Step 6: After the preset discussion time has ended, the
instructor will direct students at each table (except the scribe
who remains at the table) to the third table that has a different theme from the previous two tables. Scribes document
ideas from their third group without informing them of what
the previous teams discussed on that theme.
Step 7: After the third round of discussion has ended, the
whole class will gather and listen to the main ideas documented by the scribes. This is usually 3 to 5 minutes per
scribe. If two or more tables have the same theme, the scribes
of those tables should present at the same time or consecutively (e.g., if two scribes have the remote work theme, they
should speak to the class together or one after the other).
Table 1: Inclusive Workplace
An inclusive workplace values people of all identities (i.e.,
surface- and deep-level diversity) and allows them to be fully
themselves while contributing to the organization.
1. What challenges do organizations and their employees
experience on their journey toward an inclusive workplace? Provide specific examples.
2. How can leaders (supervisors to executives) support and
maintain workplace diversity? Provide specific examples
from your experience in an organization that emphasizes
and leverages (or undermines) the value of diversity.
3. What personal characteristics of leaders (supervisors to
executives) make them better (or worse) equipped to support and lead people in an inclusive workplace? Why are
those attributes important?
Table 2: Remote Workers
Remote workers are people who work from home or other
off-site locations (not at client sites) some or all of the time.
1. What are the challenges for the organization and for
employees who work remotely in terms of their effectiveness and well-being in this work arrangement? Provide
specific examples. Several firms (Yahoo, IBM, etc.) have
recently reduced the level of remote work. What problems do you think they experienced?
2. What personal characteristics enable some people to
work remotely better (or worse) than other people?
Why are those attributes important?
3. How can leaders (supervisors to executives) support and
maintain the performance of remote workers? Provide
specific examples from your experience as a remote
worker, a supervisor of remote workers, or knowledge of
others in those situations.
Part One
Table 3: Agency and Contract Workers
Agency workers work regularly at a client site but are
employed by another firm (outsource company). Contractors
are self-employed. This table will refer only to contractors
who work at client sites.
1. What are the challenges for the organization and for
employees who work as agency employees or contractors in terms of their effectiveness and well-being in this
work arrangement? Provide specific examples.
2. What personal characteristics enable some people to
work as agency/contract workers better (or worse) than
other people? Why are those attributes important?
3. How can leaders (supervisors to executives) support and
maintain the performance of agency and contract workers who are not their own employees? Provide specific
examples from your experience as an agency/contract
worker, a manager of agency/contract workers, or knowledge of others in those situations.
Class Exercise:
Purpose This exercise is designed to help you understand
how organizational behaviour knowledge can help you refine
and improve your personal theories about what goes on
in organizations.
Instructions Read each of the statements below and
determine whether each statement is true or false, in your
opinion. The class will consider the answers to each question and discuss the implications for studying organizational behaviour.
This exercise may also be conducted as a team activity,
whereby students answer these questions in teams rather
than alone.
A happy worker is a productive worker.
A decision maker’s effectiveness increases with the number of choices or alternatives available to them.
Organizations are more effective when they minimize conflict among employees.
Employees have more power with many close friends than with many acquaintances.
Companies are more successful when they have strong corporate cultures.
Employees perform better without stress.
The best way to change people and organizations is by pinpointing the source of their current problems.
Female leaders involve employees in decisions to a greater degree than do male leaders.
The best decisions are made without emotion.
If employees feel they are paid unfairly, nothing other than changing their pay will reduce their feelings of injustice.
Self-Assessment for Chapter 1
Are you a good remote
Remote work is an increasingly popular workplace activity, and it potentially offers benefits for both
companies and employees. However, some people are better suited than others to remote work. This
self-assessment estimates personal characteristics that relate to employee success at working remotely,
thereby providing a rough indication of how well you might adjust to this work arrangement.
Individual Behaviour and Processes
Individual Differences: Personality and Values
After reading this chapter, you should be able to:
LO1 Define personality and discuss how the Big Five personality factors relate to
workplace behaviour and performance.
LO2 Describe the dark triad of personality and the MBTI types and discuss their
implications for organizational behaviour.
LO3 Summarize Schwartz’s model of individual values and discuss the conditions where
values influence behaviour.
LO4 Describe four ethical principles and discuss three factors that influence ethical
LO5 Describe five values commonly studied across cultures, and discuss the diverse
cultures within Canada.
Getting hired at Bridgewater Associates—the
world’s largest hedge fund—is not a cakewalk. Job
applicants first watch online videos depicting the
culture and daily office life at the American investment firm. Next, they spend a few hours completing four online assessments of their personality
and values. Applicants who pass the online selection process engage in a structured interview over
the phone with consultants, who further assess
the individual’s character. Even after accepting
Bridgewater’s job offer, new recruits take a final
two-hour personality and personal values assessment developed by the company.
Bridgewater Associates places considerable weight on the
Bridgewater Associates founder Ray Dalio says
personality, values, and other individual differences of its
job applicants and employees.
assessing an individual’s personality and values
©Monkey Business Images/Shutterstock
helps the investment firm assign people to jobs
that fit their personal attributes. “I needed a systematic approach to capturing and recording our differences so that we could actively take them into
consideration when putting people into different roles at Bridgewater,” he wrote in his book Principles:
Life and Work. The information is also used to diagnose why conflicts occur and why problems arise.
Part Two
Individual Behaviour and Processes
Each employee’s personality, values, and other attributes are displayed on baseball cards available
through a digital app to everyone in the company. Each attribute has a score based on the personality test
results as well as subsequent ongoing instant evaluations by co-workers. “I found that we needed to have
these [baseball cards] and refer to them regularly because without them, people tended to interact with
each other without any regard to who was good or bad at what,” says Dalio.1
Bridgewater Associates places considerable weight on the
personality, values, and other individual differences of its job
applicants and employees. It views personality and values
as strong predictors of a person’s decisions and behaviour,
which then relate to how well they fit into particular roles
and how well they work with others at Bridgewater.
Part 2 of this book discusses individual differences and
begins in this chapter by presenting current knowledge about
personality and values in organizations. We describe the
meaning and origins of personality, introduce the five-factor
personality model, and identify how each dimension of this
highly regarded model relates to job performance and related
behaviours. Two other personality models are then introduced: the dark triad (Machiavellianism, narcissism, and
psychopathy) and the Jungian personality theory applied by
the Myers-Briggs Type Indicator (MBTI). Next, our attention turns to personal values. We describe Schwartz’s values
circumplex model, explain how personal values influence
workplace decisions and behaviour, and introduce the concept of values congruence. Later, we examine ethical values
and the mechanisms through which they influence a person’s
decisions and behaviour. The final section of this chapter
describes the best known cross-cultural values, explains their
relevance to organizational behaviour, and examines similarities and differences in personal values across Canada and
with people in the United States.
Personality and the Five-Factor Model
in Organizations
On any given day in almost
personality The relatively
every workplace, employenduring pattern of thoughts,
ees will invariably menemotions, and behaviours
tion either their own or
that characterize a person,
someone else’s personality.
along with the psychologiPersonality refers to the
cal processes behind those
relatively enduring pattern
of thoughts, emotions, and
behaviours that characterize a person, along with the psychological processes behind
those characteristics.2 In essence, personality is the bundle of
characteristics that makes us similar to or different from other
people. We estimate an individual’s personality by what they
say or do, and we infer the person’s internal states—including
thoughts and emotions—from these observable behaviours.
People engage in a wide range of behaviours in their daily
lives, yet close inspection of those actions reveals discernible
patterns called personality traits.3 Traits are broad concepts
that allow us to label and understand individual differences. For
example, some of your friends are likely quite talkative whereas
others are quieter. Some people like to take risks whereas others are risk-averse. Each trait implies that there is something
within the person, rather than environmental influences alone,
that predicts this behavioural tendency. In fact, studies report
that an individual’s personality traits measured in childhood
predict various behaviours and outcomes in adulthood, including educational attainment, employment success, marital relationships, illegal activities, and health-risk behaviours.4
Although people have behavioural tendencies, they do not
act the same way in all situations. Such consistency would be
considered abnormal because it indicates a person’s insensitivity to social norms, reward systems, and other external
conditions.5 People vary their behaviour to suit the situation,
even if the behaviour is at odds with their personality. For
example, talkative people remain relatively quiet in a library
where “no talking” rules are explicit and strictly enforced.
Even there, however, personality differences are apparent,
because talkative people tend to do more chatting in libraries
relative to how much other people talk in that setting.
Personality is shaped by both nature and nurture, although
the relative importance of each continues to be debated
and studied.6 Nature refers to our genetic or hereditary origins—the genes that we inherit from our parents. Studies of
identical twins reveal that heredity has a very large effect on
personality; up to 50 percent of variation in behaviour and
30 percent of temperament preferences can be attributed to a
person’s genetic characteristics. In other words, genetic code
not only determines our eye colour, skin tone, and physical
shape; it also significantly affects our attitudes, decisions,
and behaviour.
Personality is also shaped by nurture—our socialization, life experiences, and other forms of interaction with
Chapter Two
Individual Differences: Personality and Values 33
©David Cooper/Toronto Star/Getty Images
Paladin Security Group Ltd. is Canada’s largest independent security provider. One reason for this success is the Burnaby,
B.C.-based firm’s careful assessment of each job applicant’s personality, skills, and other strengths. Through detailed
interviews and psychological profiling, the company determines to what degree each job applicant’s personality traits
are similar to successful employees in that role. “We took our best and highest-performing people in every vertical and
profiled them to find out exactly what traits and tendencies they have that make them so successful,” says Paladin executive Chad Kalyk. Paladin CEO, Ashley Cooper, explains that different security jobs require people with different personality traits. “In health-care security, for example, we’re looking for a high level of empathy. At an industrial site, we’re looking
for high scores in task orientation and attention to detail.”*
* “How to Prepare for a Security Guard Interview,” Paladin Security (blog), June 27, 2019, https://paladinsecurity.com/security-careers/how-to-prepare-for-asecurity-guard-interview/; R. Counter, “How Paladin Security Group Became Canada’s Largest Full-Service Security FIrm,” Canadian Business, October 31, 2019.
the environment. Personality develops and changes mainly
from childhood to young adulthood, typically stabilizing by
around age 30. However, some personality changes continue
to occur later in life. For instance, a few traits (openness to
experience, social vitality) increase through to young adulthood, then decline in later years, whereas other traits (agreeableness, conscientiousness) tend to increase through to late
life. Our personality can also change somewhat due to the
job we work in over a long time period. Even migrating to
another culture can change our personality to some extent.7
The main explanation for why personality becomes more
stable by adulthood is that we form a clearer and more rigid
self-concept. This increasing clarity of “who we are” anchors
our behaviour with the help of the executive function. This
is the part of the brain that monitors and regulates goal-directed behaviour to keep it consistent with our self-concept. Our self-view becomes clearer and more stable with
age, which increases the stability and consistency of our
personality and behaviour.8 We discuss self-concept in more
detail in Chapter 3. The main point here is that personality is
not completely determined by heredity; it is also shaped by
life experiences, particularly early in a person’s life.
Sociable, anxious, curious, dependable, suspicious, talkative, adventurous, and hundreds of other personality traits
have been described over
the years, so experts have
five-factor (Big Five)
tried to organize them into
model The five broad
dimensions representing
smaller clusters. The most
most personality traits: conresearched and respected
scientiousness, neuroticism,
clustering of personality
openness to experience, agreetraits is the five-factor
ableness, and extraversion.
model, also known as the
Part Two
Individual Behaviour and Processes
Five-Factor Model of Personality
People with higher scores on this factor
tend to be more:
Organized, dependable, goal-focused, thorough,
disciplined, methodical, industrious
Trusting, helpful, good-natured, considerate, tolerant,
selfless, generous, flexible
Anxious, insecure, self-conscious, depressed,
Openness to
Imaginative, creative, unconventional, curious,
nonconforming, autonomous, perceptive
Outgoing, talkative, energetic, sociable, assertive
Big Five.9 Several decades ago, personality experts identified
more than 17,000 words that describe an individual’s personality. These words were distilled down to five broad personality dimensions, each with a cluster of specific traits. Similar
results were found in studies of different languages, suggesting that the five-factor model is fairly robust across cultures.
These Big Five factors, represented by the handy acronym
CANOE, are outlined in Exhibit 2.1 and described below.
• Conscientiousness. Characterizes people who are organized,
dependable, goal-focused, thorough, disciplined, methodical,
and industrious. People with
low conscientiousness tend
conscientiousness A perto be careless, disorganized,
sonality dimension describing
and less thorough.
people who are organized,
dependable, goal-focused,
thorough, disciplined,
methodical, and industrious.
agreeableness A personality
dimension describing people who are trusting, helpful,
good-natured, considerate,
tolerant, selfless, generous,
and flexible.
neuroticism A personality dimension describing
people who tend to be
anxious, insecure, self-conscious, depressed, and
• Agreeableness.
Describes people who
are trusting, helpful,
good-natured, considerate, tolerant, selfless,
generous, and flexible.
People with low agreeableness tend to be
uncooperative and intolerant of others’ needs as
well as more suspicious
and self-focused.
• N
euroticism. Refers to
people who tend to be
anxious, insecure, self-conscious, depressed, and temperamental. In contrast, people with low neuroticism (high
emotional stability) are poised, secure, and calm.
• Openness to experience. Characterizes people who are
imaginative, creative, unconventional, curious, nonconforming, autonomous,
and aesthetically peropenness to experience
ceptive. Those with
A personality dimension
low scores on this
describing people who are
factor tend to be more
imaginative, creative, unconventional, curious, nonconresistant to change, less
forming, autonomous, and
open to new ideas, and
aesthetically perceptive.
more conventional and
extraversion A personality
fixed in their ways.
dimension describing people
who are outgoing, talkative,
• Extraversion.
sociable, and assertive.
Describes people who
are outgoing, talkative,
energetic, sociable, and
assertive. The opposite is introversion, which characterizes those who are quiet, cautious, and less interactive
with others. Extraverts get their energy from the outer
world (people and things around them), whereas introverts get their energy from the internal world, such as
personal reflection on concepts and ideas. Introverts do
not necessarily lack social skills. Instead, they are more
inclined to direct their interests to ideas than to social
events. Introverts feel more comfortable being alone than
do extraverts.
Chapter Two
Individual Differences: Personality and Values 35
What is your Big Five personality? You can discover your Big Five personality by completing this selfassessment in Connect.
Are you introverted or extraverted? You can discover your level of introversion or extraversion by
completing this self-assessment in Connect.
Five-Factor Model and Work Performance
Personality mainly affects behaviour and performance
through motivation, specifically by influencing the individual’s choice of goals (direction) as well as intensity and
persistence of effort toward those goals. Consequently, all of
the Big Five factors predict one or more types of employee
behaviour and performance to some extent.
Exhibit 2.2 highlights which Big Five personality factors
best predict the three types of task performance as well as organizational citizenship and counterproductive work behaviours
(see Chapter 1).10 Conscientiousness stands out as the best
overall personality predictor of proficient task performance
for most jobs. The specific conscientiousness traits of industriousness (achievement, self-discipline, purposefulness) and
dutifulness are the best predictors of proficient task performance. Conscientious employees set higher personal goals
for themselves and are more persistent. They also engage in
more organizational citizenship and in less counterproductive
work behaviour. Conscientiousness is a weak predictor of
adaptive performance (responding to change) and proactive
performance (taking initiative toward new work patterns). In
fact, two specific conscientiousness traits—orderliness and
dependability—tend to suppress adaptivity.
Extraversion is the second best overall personality predictor of proficient task performance, but it is a much weaker
predictor than is conscientiousness. Among the specific
traits within the extraversion factor, assertiveness and positive emotionality are the strongest predictors of proficient
task performance. Assertiveness is also a strong predictor of
Five-Factor Personality and Work Performance
(top-left): Ildar Galeev/Shutterstock; (top-centre): Ho Yeow Hui/Shutterstock; (top-right): malika.1028/Shutterstock; (bottom-left): Aha-Soft/Shutterstock; (bottom-right):
Sign N Symbol Production/Shutterstock
Part Two
Individual Behaviour and Processes
Can you identify personality traits from blogging words? You can discover how well you interpret
someone’s personality in blogs and other writing by completing this self-assessment in Connect.
adaptive and proactive performance. Assertive employees
tend to have a “take charge” approach to situations, which is
consistent with adapting to change and proactively initiating
change. Extraversion is associated with influencing others
and being comfortable in social settings, which (along with
being assertive) explains why effective leaders and salespeople tend to be somewhat more extraverted than the general
Agreeableness is positively associated with organizational
citizenship and negatively associated with counterproductive work behaviours.11 The reason for this is that employees with high agreeableness are motivated to be cooperative,
sensitive, flexible, and supportive. Agreeableness does not
predict proficient or proactive task performance very well,
mainly because it is associated with lower motivation to set
goals and achieve results. However, employees with higher
(but not too high) agreeableness tend to improve team performance through better knowledge sharing and motivation
to help the team. Agreeableness also has a positive effect on
friendliness behaviour in customer service jobs.12
Openness to experience is a weak predictor of proficient
task performance, but it is one of the best personality predictors of adaptive and proactive performance. The main reason
is that employees with higher openness scores have more
curiosity, imagination, and tolerance of change.13 These
traits also explain why openness to experience is associated
with successful performance in creative work.
Emotional stability (low neuroticism) is one of the best personality predictors of adaptive performance.14 The main explanation is that employees with higher emotional stability cope
better with the ambiguity and uncertainty of change. In contrast, those with higher neuroticism view change as a threat,
so they tend to avoid change and experience more stress when
faced with workplace adjustments. These characteristics would
suggest that emotional stability also predicts proactive performance, but the limited research has reported mixed results.
The five-factor model of personality is widely accepted
among scholars and has a deep research foundation to support its structure and usefulness at predicting workplace
behaviour. However, we need to alert you to several issues
to better understand and apply this theory to the workplace.
• Higher isn’t always better. A common assumption is
that the “perfect employee” has the highest scores on
all of the Big Five personality factors (where emotional stability is high and neuroticism is low). Part of
the problem may be that the labels and structure of the
Big Five factors have a strong linear bias (high is good,
low is bad).15 But several studies have reported that the
best employees don’t have the highest scores on some
personality factors. In other words, the relationship
between personality and performance is often nonlinear. Employees with moderate extraversion perform
better in sales jobs than those with high or low extraversion.16 One recent study found that students with the best
peer-rated contributions to teamwork have relatively high
extraversion but moderately high conscientiousness, and
rate only around the mid-point on agreeableness.
• Specific traits sometimes predict better than the Big Five
factors. We pay so much attention to the Big Five
factors that the specific personality traits within each
factor are often forgotten. Yet, specific traits are
sometimes better than the broader factor at predicting
behaviour and performance. This was noted earlier in
this section when we pointed out that the specific extraversion traits of assertiveness and positive emotionality
predict proficient task performance better than the overall extraversion factor.
• Personality isn’t static. There is an unfortunate tendency
to think an adult’s personality is frozen for a lifetime.
Labelling people (“She’s an introvert”) reinforces this
fallacy that personality is static. Personality does stabilize
around age 30, but that doesn’t mean it is static. As we
noted at the beginning of this topic, some Big Five factors tend to increase or decrease as we age. Personality
can also shift when the individual’s environment changes
significantly over a long time, such as when moving to a
different culture or working in a job for many years.
• The five-factor model doesn’t cover all personality. A
common mistake is to assume that the five-factor model
measures all aspects of personality.17 The five-factor
model does capture a large portion of the domain we
call personality, but not all of it. There are several perspectives or approaches to personality, each of which has
a somewhat different view or emphasis. For example,
needs and motives, which we discuss in Chapter 5, are
discussed as components of some personality models, but
not others. The existence of personality concepts beyond
the five-factor model is apparent in the next section of this
chapter, which introduces two other models of personality
that only partially overlap with the Big Five factors.
Chapter Two
Other Personality Concepts: The Dark
Triad and MBTI Types
Several decades ago when personality experts distilled thousands of dictionary words down to the five-factor model,
they deliberately excluded words with explicitly positive or
negative valence, such as humble (positive) or sinister (negative). They initially even excluded words such as agreeable
and ambitious that were later added to the Big Five analysis.
The process of reducing words into categories also chopped
off weaker clusters that coincidentally had positive or negative orientations. Yet, some of these excluded traits (such as
impulsive) appeared in earlier personality models and were
widely known in clinical work.18
Personality researchers eventually re-examined traits with
positive and negative valences. From that work, two scholars in Canada identified a new cluster, which they called the
dark triad.19 The dark triad
dark triad A cluster of
includes three socially undethree socially undesirable
sirable personality traits—
(dark) personality traits:
Machiavellianism, narcisMachiavellianism, narcissism,
sism, and psychopathy. Each
and psychopathy.
of these three traits has
distinct characteristics, but
collectively they have a common “dark core” consisting of
either low humility/honesty or a tendency to malevolently
undermine others to maximize one’s own gains.20
• Machiavellianism. This personality trait is named after
Niccolò Machiavelli, the 16th-century Italian philosopher
who wrote The Prince, a famous treatise about political
behaviour. People with high Machiavellianism (highMachs) demonstrate a strong motivation to get what they
want at the expense of others. They believe that deceit is a
natural and acceptable way to achieve their goals; indeed,
they take pleasure in misleading, outwitting, and othMachiavellianism A personality trait of people who
erwise controlling others.
demonstrate a strong motiHigh-Machs routinely use
vation to achieve their own
lies, manipulation, exploitagoals at the expense of othtion, and other undesirable
ers, who believe that deceit is
influence tactics. They
a natural and acceptable way
to achieve their goals, who
have a cynical disregard for
take pleasure in outwitting
moral principles, believe
and misleading others using
that getting more than one
crude influence tactics, and
deserves is acceptable, and
who have a cynical disregard
seldom empathize with or
for morality.
trust co-workers.21
Individual Differences: Personality and Values 37
• Narcissism. This pernarcissism A personality
sonality trait is named
trait of people with a grandiafter Narcissus, the
ose, obsessive belief in their
young male hunter in
superiority and entitlement,
Greek mythology who
a propensity to aggressively
engage in attention-seekwas so obsessed with
ing behaviours, an intense
his beauty that he could
envy of others, and tennot stop admiring his
dency to exhibit arrogance,
reflection in a pool
callousness, and exploitaof water (he died of
tion of others for personal
thirst because he didn’t
want to stop looking at
psychopathy A personality
trait of people who ruthlessly
himself). This trait is
dominate and manipulate othevident in people who
ers without empathy or any
have an obsessive belief
feelings of remorse or anxiety,
in their superiority and
use superficial charm, yet are
entitlement. Along with
social predators who engage
their grandiose, inflated
in antisocial, impulsive, and
often fraudulent thrill-seeking
self-view, narcissists
have an excessive need
for attention, so they
aggressively engage in
self-promotion, exhibitionism, and other attention-seeking behaviours. Although known to be initially charming, narcissists are intensely envious of others, which is
eventually apparent in their arrogance, schadenfreude
(deriving pleasure from another person’s misfortune),
callous disregard for others’ feelings (i.e., low empathy),
and exploitation of others for personal aggrandizement.22
• Psychopathy. This personality trait is often considered
the most sinister of the triad. It refers to social predators
who ruthlessly dominate and manipulate others, yet
without empathy or any feelings of remorse or anxiety.
They are selfish self-promoters who use superficial
charm (called the “mask” of psychopathy), yet engage in
antisocial, impulsive, and often fraudulent thrill-seeking
behaviour. These people callously do as they please and
take what they want.23
The Dark Triad in the Workplace
Machiavellianism, narcissism, and psychopathy may seem
like they belong in textbooks on criminology or medieval
politics, not organizational behaviour. Yet, these traits are
gaining attention because they are prevalent throughout the
workplace. As one personality researcher warned in his keynote address to the Canadian Police Association: “Not all
psychopaths are in prison. Some are in the boardroom.”24
Dishonesty is a core characteristic of the dark triad, so
people with these traits are more likely to lie and deceive
others at work. Similarly, they malevolently undermine
others to maximize their own gains. This is the essence of
Part Two
Individual Behaviour and Processes
Global Connections 2.1
Elon Musk has never been shy about saying what he
thinks. The Canadian-South African entrepreneur and
CEO of Tesla, SpaceX, and the Boring Company tweets
an average of 88 messages per month to his 35 million
followers. His twitter mania has occasionally reached
400 messages in one month alone. To put this in perspective, only 7 percent of Canada’s top 100 CEOs are
on Twitter at all, and most of them have an average of
only 316 followers!
Public relations experts suggest that Musk’s tweet
mania and his flair for crafting casual messages makes
him a good communicator. But the volume of tweets
might also reveal narcissistic tendencies. A recent
meta-analysis reported that individuals with high scores
on grandiose narcissism produce a significantly higher
number of tweets and Facebook updates, have more
friends (or followers), and post more selfies. To a lesser
extent, they also spend more time on social media.
Grandiose narcissism refers to people who are interpersonally dominant, self-absorbed, overconfident, and
have an inflated sense of superiority and entitlement.
As part of the dark triad, narcissists also tend to be more
disagreeable and antagonistic toward others compared
to the average person. Twitter tweets and Facebook
updates fit nicely with grandiose narcissism because
these people prefer emotionally shallow social relationships and rely on mass communication to fulfil their
need for attention and self-promotion.
Elon Musk’s tweet output doesn’t necessarily mean
that he is narcissistic, although more than a dozen
leading newspapers, magazines, and business-school
blogs have recently made that assertion. Also, the
aggressive and antagonistic content of Musk’s tweets
are consistent with grandiose narcissism.
Tesla’s legal tussles with the U.S. Securities and
Exchange Commission and other government agencies
(arising from Musk’s tweets) are also consistent with
studies on narcissistic executives. One recent study
concluded that “narcissistic CEOs subject their organizations to undue legal risk because they are overconfident about their ability to win and less sensitive to the
costs to their organizations of such litigation.”
But Elon Musk might have the last word on this matter: “If I am a narcissist (which might be true), at least I
am a useful one,” he has tweeted.
©John Raoux/AP Photo
* “New Study: Only Half of Canada’s Top 100 CEOs Are on Social Media,” News Release (Toronto: Signal Leadership Communication Inc, September
29, 2016); M.J. Coren and Y. Zhou, “We’ve Tracked All of Musk’s Tweets since 2015. It’s Never Been like This,” Quartz, June 1, 2018; D. Lovric and T.
Chamorro-Premuzic, “Why Great Success Can Bring Out the Worst Parts of Our Personalities,” Harvard Business Review (Online), August 9, 2018; S. Singh,
S.D. Farley, and J.J. Donahue, “Grandiosity on Display: Social Media Behaviors and Dimensions of Narcissism,” Personality and Individual Differences 134
(2018): 308–13, https://doi.org/10.1016/j.paid.2018.06.039; J.L. McCain and W.K. Campbell, “Narcissism and Social Media Use: A Meta-Analytic Review,”
Psychology of Popular Media Culture 7, no. 3 (2018): 308–27, https://doi.org/10.1037/ppm0000137; C.A. O’Reilly, B. Doerr, and J.A. Chatman, “‘See You in
Court’: How CEO Narcissism Increases Firms’ Vulnerability to Lawsuits,” The Leadership Quarterly 29, no. 3 (2018): 365–78, https://doi.org/10.1016/j.leaqua.2017.08.001; P. Marx, “Opinion | Elon Musk’s Twitter Meltdowns Are Just the Beginning,” NBC News, October 24, 2018; S. Ben-Hur, “Will Elon Musk’s
Narcissism Be His Downfall?,” Research & Knowledge, IMD Business School(blog), October 2018, https://www.imd.org/research-knowledge/articles/WillElon-Musks-narcissism-be-his-downfall/; A. Ohnsman, “Elon Musk’s Tesla Tweet Puts CEO Role At Risk Again,” Forbes, February 25, 2019; M.J. Coren, “Elon
Musk May Not Be the Narcissist Tesla Needs Right Now,” Quartz, March 4, 2019.
organizational politics The
use of influence tactics for
personal gain at the perceived expense of others and
the organization.
organizational politics (see
Chapter 10), which is about
using influence tactics for
personal gain at the expense
of others and the interests
of the entire organization.
Political tactics produce
a host of dysfunctional outcomes, ranging from employee
stress and dissatisfaction to unproductive use of organizational
resources. People with dark triad personality traits are dysfunctional team members in the long term because, by definition,
they don’t trust co-workers and focus on their own goals at the
expense of team goals.25 At the same time, they are known to
help others in the short run when it serves their self-interest.
Chapter Two
Individual Differences: Personality and Values 39
How Machiavellian are you? You can discover how much you value the political tactics emphasized
by Machiavelli by locating this self-assessment in Connect.
The dark triad traits are strongly associated with serious white-collar crime behaviour. For instance, one study
reported that a dark triad measure from video analysis was
highly effective at identifying chief executive officers who
were implicated in unethical misconduct and fraud.26 People
with dark triad personality traits are more likely to engage in
bullying and other forms of workplace aggression.27 They also
tend to make decisions that produce poorer absolute and riskadjusted investment returns. In particular, those with high
psychopathy take excessive risks due to their overconfidence
and disregard for consequences.28 The dark triad
counterproductive work
predicts counterproducbehaviours (CWBs) Voluntary
tive work behaviours, but
behaviours that have the
not as well as do the spepotential to directly or indicific Big Five factors of
rectly harm the organization.
low agreeableness and low
People who possess dark triad personality traits aren’t always
worse off. They have a manipulative political skill, which
some supervisors rate favourably in employee performance.
Being manipulative also occasionally helps employees move
into more powerful positions in informal employee networks.
Narcissistic CEOs tend to have higher direct pay as well as a
higher gap in pay from other members of the executive team.29
The five-factor model of
personality has the most
research support, but it is not
the most popular personality
test in organizations. That
distinction goes to Jungian
personality theory, which
is measured through the
Myers-Briggs Type Indicator (MBTI) (see Exhibit 2.3).
Nearly a century ago, Swiss psychiatrist Carl Jung proposed that personality is mainly represented by the individual’s preferences regarding perceiving and judging
information.30 Jung explained that the perceiving function—
how people prefer to gather information—occurs through two
competing orientations: sensing (S) and intuition (N). Sensing
involves perceiving information directly through the five
senses; it relies on an organized structure to acquire factual
Myers-Briggs Type Indicator
(MBTI) An instrument
designed to measure the elements of Jungian personality
theory, particularly preferences regarding perceiving
and judging information.
and preferably quantitative details. In contrast, intuition relies
more on insight and subjective experience to see relationships
among variables. Sensing types focus on the here and now,
whereas intuitive types focus more on future possibilities.
Jung also proposed that the judging function—how
people prefer making decisions based on what they have
perceived—consists of two competing processes: thinking
(T) and feeling (F). People with a thinking orientation rely
on rational cause–effect logic and systematic data collection to make decisions. Those with a strong feeling orientation, on the other hand, give more weight to their emotional
responses to the options presented, as well as to how those
choices affect others. Jung noted that in addition to the four
core processes of sensing, intuition, thinking, and feeling,
people differ in their level of extraversion–introversion,
which was introduced earlier as one of the Big Five personality factors.
The MBTI extends Jung’s list of personality traits
described above by also measuring Jung’s broader categories of perceiving and judging, which represent a person’s
attitude toward the external world. People with a perceiving
orientation are open, curious, and flexible. They like to keep
their options open and to adapt spontaneously to events as
they unfold. Judging types prefer order and structure and
want to resolve problems quickly.
MBTI has a number of benefits, but it is usually a poor
predictor of job performance and is generally not recommended for employment selection or promotion decisions.31
There are also issues with its measurement. MBTI can
potentially identify employees who prefer face-to-face versus
remote teamwork, but it does not predict how well a team
develops. It also has questionable value in predicting leadership effectiveness.
In spite of these limitations, the MBTI is the most widely
studied measure of cognitive style in management research
and is the most popular personality test for career counselling and executive coaching.32 It is even being used by
artificial intelligence engineers to adapt the behaviour of
robots to user preferences. MBTI takes a neutral or balanced
approach by recognizing both the strengths and limitations
of each personality type in different situations. In contrast,
the five-factor model views people with higher scores as better than those with lower scores on each dimension. As such,
the Big Five model may have adopted a restrictive view of
personality that is more difficult to apply in coaching and
development settings.33
Part Two
Individual Behaviour and Processes
Jungian and Myers-Briggs Type Indicator Types
Extraversion (E)
Sensing (S)
Thinking (T)
• Logical
• Impersonal
Judging (J)
Orienting to the
external world
Introversion (I)
• Quiet
• Internally-focused
• Abstract
Intuitive (N)
• Imaginative
• Future-focused
• Abstract
Feeling (F)
Perceiving (P)
• Spontaneous
• Adaptable
• Opportunity-focused
Are you a sensing or intuitive type? You can discover the extent to which you are a sensing or
intuitive type by completing this self-assessment in Connect.
Personality theory has made significant strides over the
past two decades, particularly in demonstrating that
specific traits are associated with specific workplace
behaviours and outcomes. Various studies have reported
that the Big Five dimensions predict overall job performance, organizational citizenship, leadership, counterproductive work behaviours, training performance, team
performance, and a host of other important outcomes.
These findings cast a strong vote in favour of personality
testing in the workplace.
A few prominent personality experts urge caution, however.* They point out that, although traits are associated
with workplace behaviour to some extent, there are better predictors of work performance, such as work samples
and past performance. Furthermore, selection procedures
typically assume that more of a personality trait is better,
whereas an increasing number of studies indicate that
the best candidates might be closer to the middle than
the extremes of the range. For instance, job performance
apparently increases with conscientiousness, yet employees with high conscientiousness might be so thorough
that they become perfectionists, which can stifle rather
than enhance job performance.** A third concern is that,
depending on how the selection decision applies the test
results, personality instruments may unfairly discriminate
against specific groups of people.***
A fourth worry is that most personality tests are
self-report scales, so applicants might try to fake their
answers.**** Worse, the test scores might not represent
the individual’s personality or anything else meaningful
Chapter Two
because test takers often don’t know what personality
traits the company is looking for. Studies show that candidates who try to fake “good” personality scores change
the selection results. Supporters of personality testing
offer the counter-argument that few job applicants try to
Individual Differences: Personality and Values 41
fake their scores. One major study found that most personality dimensions are estimated better by observers than by
self-ratings. However, few companies rely on ratings from
other people.*****
* K. Murphy and J.L. Dzieweczynski, “Why Don’t Measures of Broad Dimensions of Personality Perform Better as Predictors of Job Performance?,” Human
Performance 18, no. 4 (2005): 343–57; F.P. Morgeson et al., “Reconsidering the Use of Personality Tests in Personnel Selection Contexts,” Personnel Psychology
60, no. 3 (2007): 683–729; N. Schmitt, “Personality and Cognitive Ability as Predictors of Effective Performance at Work,” Annual Review of Organizational
Psychology and Organizational Behavior 1, no. 1 (2014): 45–65.
** J. Stoeber, K. Otto, and C. Dalbert, “Perfectionism and the Big Five: Conscientiousness Predicts Longitudinal Increases in Self-Oriented Perfectionism,” Personality
and Individual Differences 47, no. 4 (2009): 363–68; C.J. Boyce, A.M. Wood, and G.D.A. Brown, “The Dark Side of Conscientiousness: Conscientious People
Experience Greater Drops in Life Satisfaction Following Unemployment,” Journal of Research in Personality 44, no. 4 (2010): 535–39.
*** S.D. Risavy and P.A. Hausdorf, “Personality Testing in Personnel Selection: Adverse Impact and Differential Hiring Rates,” International Journal of Selection and
Assessment 19, no. 1 (2011): 18–30.
**** N.S. Hartman and W.L. Grubb, “Deliberate Faking on Personality and Emotional Intelligence Measures,” Psychological Reports 108, no. 1 (2011): 120–38;
J.J. Donovan, S.A. Dwight, and D. Schneider, “The Impact of Applicant Faking on Selection Measures, Hiring Decisions, and Employee Performance,” Journal of
Business and Psychology 29, no. 3 (2014): 479–93.
***** B.S. Connelly and D.S. Ones, “An Other Perspective on Personality: Meta-Analytic Integration of Observers’ Accuracy and Predictive Validity,” Psychological
Bulletin 136, no. 6 (2010): 1092–122; J.J. Jackson et al., “Your Friends Know How Long You Will Live: A 75-Year Study of Peer-Rated Personality Traits,”
Psychological Science 26, no. 3 (2015): 335–40.
Values in the Workplace
Assiniboine Credit Union has developed an enviable reputation as a values-driven organization that supports financial literacy training, community hiring, social purchasing,
social-impact financial services, and other corporate social
responsibility initiatives. By demonstrating its values orientation, the Winnipeg-based financial institution has become
a magnet for job applicants with like-minded personal values. “When you can align your personal values with the
company you’re working for, it takes being a great place to
work to a whole new level,” advises an Assiniboine Credit
Union executive.34
Most of us think about
values Relatively stable evalour personal values when
uative beliefs that guide a
deciding where to work
person’s preferences for outand what choices we make
comes or courses of action in
every day on the job.
a variety of situations.
Values, a concept that we
introduced in Chapter 1, are
stable, evaluative beliefs that guide our preferences for outcomes or courses of action in a variety of situations.35 They
are perceptions about what is good or bad, right or wrong.
They tell us what we “ought” to do. Personal values serve as
a moral compass; they influence our motivation and potentially our decisions and actions in various situations. They
also provide justification for past decisions and behaviour.
People arrange values into a hierarchy of preferences,
called a value system(or, more correctly, a values system).
Some individuals value new challenges more than they
value conformity. Others value generosity more than frugality. Each person’s unique values system is developed
and reinforced through socialization from parents, religious
institutions, friends, personal experiences, and the society in
which they live. As such, a person’s hierarchy of values is
stable and long-lasting. For example, one study found that a
sample of adolescents had values systems that were remarkably similar 20 years later as adults.36
Our description of values has focused on individuals,
whereas Assiniboine Credit Union is described as a values-driven organization. In reality, values exist only within
individuals—we call them personal values. However, groups
of people might hold the same or similar values, so we tend
to ascribe these shared values to the team, department, organization, profession, or entire society. The values shared by
people throughout an organization (organizational values)
receive fuller discussion in Chapter 14 because they are a
central component of organizational culture. The values
shared across a society (cultural values) receive attention in
the last section of this chapter.
Values and personality traits are related to each other, but
the two concepts differ in a few ways.37 The most noticeable distinction is that values are evaluative (they tell us
what we ought to do), whereas personality traits are descriptive (they refer to what we naturally tend to do). A second
distinction is that personality traits have minimal conflict
with each other—you can have high agreeableness as well
as high introversion, for example—whereas some values
are opposed to other values. This opposing effect means
that someone who values excitement and challenge would
have difficulty also valuing stability and moderation. Third,
although personality and values are both partly determined
by heredity, values are influenced more by socialization
whereas heredity has a stronger influence on an individual’s
personality traits.
Part Two
Individual Behaviour and Processes
©Stuart C. Wilson/Stringer/Getty Images
Julie Averill’s decision to join Vancouver-based Lululemon was partly motivated by the opportunity to guide the athletic
apparel firm’s digital transformation. But the veteran information technology executive also considered the fit between her
personal values and Lululemon’s culture. “I choose to work with companies that have values that align with my own, and
who care about important things in the world,” says Averill, who is remotely located in Seattle with Lululemon’s technology
team. “I get inspired every day by people who live their lives to their values and find their passion along the way.”*
*“Reign FC Legend: Julie Averill,” Medium, May 12, 2017; S.A. Schwartz, “Lululemon CTO Aligns Personal Values with the Company’s Mission through Tech,”
CIO Dive, December 5, 2018; R. Torres, “CTO of the Year: Julie Averill, Lululemon,” CIO Dive, December 12, 2019.
Values come in many forms, and experts on this topic have
devoted considerable attention to organizing them into clusters. By far, the most widely accepted model of personal values is Schwartz’s values circumplex, developed and tested by
social psychologist Shalom Schwartz and his colleagues.38
This model clusters 57 values into 10 broad values categories that are organized into the circular model (circumplex)
shown in Exhibit 2.4. The 10 categories include universalism, benevolence, tradition, conformity, security, power,
achievement, hedonism, stimulation, and self-direction. Each
category is a cluster of several specific values (not shown in
the exhibit). For example, conformity includes the values of
politeness, honouring parents, self-discipline, and obedience.
The 10 broad values categories are further clustered into
four quadrants. One quadrant, called openness to change,
refers to the extent to which a person is motivated to pursue
innovative ways. It includes the values categories of self-direction (creativity, independent thought), stimulation (excitement and challenge), and hedonism (pursuit of pleasure,
enjoyment, gratification of desires). The opposing quadrant
is conservation, which is the extent to which a person is motivated to preserve the status quo. The conservation quadrant
includes the values categories of conformity (adherence to
social norms and expectations), security (safety and stability),
and tradition (moderation and preservation of the status quo).
The third quadrant in Schwartz’s circumplex model,
called self-enhancement, refers to how much a person is
motivated by self-interest. It includes the values categories
of achievement (pursuit of personal success), power (dominance over others), and hedonism (a values category shared
with openness to change). The opposite of self-enhancement
is self-transcendence, which refers to motivation to promote
the welfare of others and nature. Self-transcendence includes
the values categories of benevolence (concern for others in
one’s life) and universalism (concern for the welfare of all
people and nature).
Personal values motivate our decisions and behaviour in
three ways:39
• Values influence the attractiveness of choices. Our decisions are guided by personal values because those values
generate positive or negative feelings (valences) toward
the available choices. We experience more positive
Chapter Two
Individual Differences: Personality and Values 43
Schwartz’s Values Circumplex
Openness to change
What are your dominant values? You can discover your values system hierarchy in Schwartz’s model
by completing this self-assessment in Connect.
feelings toward choices that are aligned with our values
and negative feelings toward alternatives that are contrary to our values. If stimulation is at the top of your
values hierarchy, for instance, then jobs that offer new
experiences will appeal to you more than jobs that have
predictable and stable tasks.
• Values frame our perceptions of reality. We are constantly bombarded with stimuli from our surroundings.
Personal values influence whether we notice something
as well as how we interpret it (see Chapter 3). Our
decisions and actions are affected by how we perceive
those situations.
• Values help regulate the consistency of behaviour. People
are motivated to act consistently with their personal
values and other aspects of their self-concept. If achievement is a key feature of your self-view and public image,
then you are motivated to act in ways that are consistent
with that value. The more clearly a behaviour is aligned
with a specific value that identifies us, the more motivated we are to engage in that behaviour.
Personal values motivate behaviour to some extent, but
this connection isn’t as strong as we might like to believe.40
One reason for this “disconnect” between personal values
and individual behaviour is the situation. Personal values
motivate us to engage in specific behaviour, but the MARS
model points out that the situation can prevent us from engaging in values-consistent behaviour. For example, individuals
with strong self-transcendent values are motivated to engage
in recycling and other environmentally friendly behaviours,
but lack of recycling facilities prevents or severely limits this
behaviour. A second reason why an individual’s behaviour
deviates from their personal values is the presence of strong
counter-motivational forces. As an example, employees
caught in illegal business dealings sometimes attribute their
unethical activities to pressure from management to achieve
their performance targets at any cost.
A third reason why decisions and behaviour are inconsistent
with our personal values is that we don’t actively think about
them much of the time.41 Values are abstract concepts, so their
relevance is not obvious in many situations. Furthermore,
Part Two
Individual Behaviour and Processes
many decisions and actions occur routinely, so we don’t
actively evaluate their consistency with our values. We do
consciously consider our values in some situations, of course.
For example, the importance to us of security becomes salient
when deciding whether to perform a risky task. However,
many daily events do not trigger values awareness, so we act
without their guidance. We literally need to be reminded of
our values so they can guide our decisions and actions.
The effect of values awareness on behaviour was apparent in a study in which students were given a math test and
received a payment for each correct answer.42 One group
couldn’t lie about their results because they submitted their
results to the experimenter for scoring. A second group could
lie because they scored the test themselves and told the experimenter their test score. A third group was similar to the second
(they scored their own test), but that test included the following statement, and students were required to sign their name
below that statement: “I understand that this short survey falls
under (the university’s) honour system.” The researchers estimated that some students cheated when they scored their own
test without the “honour system” statement, whereas no one
given the “honour system” form lied about their results. The
university didn’t actually have an official honour statement,
but the message made students pay attention to their honesty.
In short, people are more likely to apply their values (honesty,
in this case) when they are explicitly reminded of those values
and see their relevance to the situation.
At the beginning of this section, an executive at Assiniboine
Credit Union counselled that employees are much more satisfied and effective when they work for a company that fits their
personal values. The key concept here is values congruence,
which refers to how similar a person’s values hierarchy is to the
values hierarchy of the organization or any other entity (such
Global Connections 2.2
When IKEA Canada recently advertised a job
opening for a “Goods Flow Co-worker” in Ottawa,
the job description identified experience in material handling equipment, computer aptitude, ability
to lift up to 50 pounds (23 kg), and other traditional
criteria. But it also requested something that isn’t
found in most job ads: “The IKEA values really reflect
my own values.”
IKEA describes itself as a values-driven company,
so job applicants need to assess whether their personal values are congruent with the global retailer’s
organizational values. “We recruit by values,” explains
Anna Carin Månsson, Country HR Manager, IKEA India.
“We like to understand personal values of a candidate
and how these come out in typical behaviour in everyday life.”
Månsson’s team pays attention to whether job
applicants have really considered values congruence.
“When recruiting for IKEA, it is attractive to recognize
that the applicant has read up about the company and
managed to describe the connection—i.e., what are the
values they have as a person which makes them the
perfect fit for working with the organization.”
“Your values are more important than your CV” at
IKEA, says D’neale Prosser, the national talent manager
at IKEA Australia. Prosser adds that values congruence
isn’t just useful for getting hired at IKEA. It is central
to a person’s success and happiness in life. “Find an
organization that connects with your personal values
and allows you to be yourself at work,” advises Prosser.
“This will add value and meaning to your everyday life.”
©UPI/Alamy Stock Photo
* “‘We Believe That Your Values Are More Important than Your CV,’”Human Resources Director Australia, April 11, 2018; V. Sawhney, “What I Look for
in Candidates: An Interview with Anna-Carin Månsson,” HBR Ascend(blog), August 2018, https://hbrascend.org/topics/look-candidate-interview-anna-carin-mansson/; N. Yazxhi, “BM Expert: How to Future Proof Your Career,” Bellamumma(blog), October 17, 2018, http://bellamumma.com/2018/10/17/
bm-expert-how-to-future-proof-your-career/; C. Lamba, “Understanding the HR Policies of IKEA,” India Retailing, December 17, 2018. The job advertisement
for a Goodsflow Co-worker in Ottawa was retrieved from IKEA Canada’s jobs website on December 14, 2019.
Chapter Two
as a team or society). When personal values are congruent
with the organization’s values, employees tend to experience
higher job satisfaction, loyalty, and organizational citizenship.
They also have less stress and turnover. Furthermore, employees are more likely to make decisions that are compatible with
organizational expectations when their personal values are
congruent with the organization’s shared values.43
Are organizations the most successful when every employee’s personal values align with the company’s values? Not at
all! While a large degree of values congruence is necessary
for the reasons just noted, organizations also benefit from
some level of incongruence. Employees with diverse values
offer different perspectives, which potentially lead to better
decision making. Also, too much congruence can create a
“corporate cult” that potentially undermines creativity, organizational flexibility, and business ethics (see Chapter 14).
Ethical Values and Behaviour
When 1,000 Canadians were asked to identify the most
important qualities of an ideal leader, 95 percent chose “honesty.” In another survey, both Canadian employees and executives placed “integrity” at the top of the list of attributes of
an effective corporate leader. And when 195 business leaders
across 15 countries were asked to identify the most important leader competencies, “high ethics and moral standards”
was the top-rated item from the list of 74 characteristics.44
These surveys reveal the importance of ethics in the workplace. Ethics refers to the study of moral principles or values
that determine whether actions are right or wrong and outcomes are good or bad. People rely on their ethical values to
determine “the right thing to do.”
Individual Differences: Personality and Values 45
• Individual rights. This principle says that everyone
has the same set of natural rights, such as freedom of
speech, freedom of movement, the right to physical
security, and the right to fair trial. The individual rights
principle extends beyond legal rights to human rights
that everyone is granted as a moral norm of society. One
problem with this principle is that some individual rights
may conflict with others. The shareholders’ right to be
informed about corporate activities may ultimately conflict with an executive’s right to privacy, for example.
• Distributive justice. This principle says that the benefits
and burdens of similar individuals should be the same;
otherwise they should be proportional. For example,
employees who contribute equally in their work should
receive similar rewards, whereas those who make a lesser
contribution should receive less. A variation of this principle says that inequalities are acceptable when they benefit the least well off in society. The main problem with
the distributive justice principle is that it is difficult to
agree on who is “similar” and what factors are relevant.
We discuss distributive justice further in Chapter 5.
• Ethic of care. This principle states that everyone has a
moral obligation to help others within their relational
sphere to grow and self-actualize.46 Thus, caring for others
is a fundamental characteristic of humanity and an ethical
virtue. Ethic of care includes being attentive to others’
needs, using one’s abilities to give care to others, and being
responsive to (having empathy for) the person receiving
care. This principle is found in writing about how organizations should serve stakeholders and how leaders should
serve employees (see servant leadership in Chapter 12).47
Most ethical issues are associated with four ethical principles: utilitarianism, individual rights, distributive justice,
and the ethic of care.45 Your personal values might sway you
more toward one principle than the others, but all four should
be actively considered when making decisions that have ethical implications.
Along with ethical principles and their underlying values,
three other factors also influence ethical conduct in the
workplace: the moral intensity of the issue, the individual’s
moral sensitivity, and situational factors.48
• Utilitarianism. This principle says the only moral obligation is to seek the greatest good for the greatest number
of people. We should choose the option that provides
the highest degree of satisfaction to those affected. One
problem is that utilitarianism requires a cost–benefit
analysis, yet many outcomes aren’t measurable. Another
problem is that utilitarianism focuses only on outcomes,
whereas the means of achieving those outcomes may be
considered unethical by other principles.
Moral intensity is the degree to which an issue demands
the application of ethical principles. The higher the moral
intensity of an issue, the more the decision maker needs to
carefully apply ethical principles to make the best choice.
The moral intensity of an
moral intensity The degree
issue is essentially about
to which an issue demands
(a) how seriously (good or
the application of ethical
bad) people will be affected
by the decision, (b) the
Moral Intensity
Part Two
Individual Behaviour and Processes
Global Connections 2.3
When William O’Rourke became Alcoa Russia’s first
CEO, he knew that bribery was a serious problem in that
country, so he made his position clear to staff: “We don’t
condone it. We don’t participate in it. We are not going
to do it. Period.” This ethical mandate was soon tested
when local police stopped delivery of an $18 million
furnace and declared that delivery would resume only
after Alcoa paid $25,000 to a local government official
(all figures are in U.S. dollars).
“My bonus was based in large part on making the
planned investments happen on time,” says O’Rourke.
A few Alcoa executives in the United States advised
that he should do whatever it takes to keep the work
on schedule, implying that perhaps it would be better
to pay the bribe. “Nonetheless,” he recalls, “I stood
my ground.” The new furnace arrived three days later
without any bribery payment. It took another 18 months
before the bribery attempts stopped.
©Ozgur Donmaz/Getty Images
* J.T. Kennedy, “Alcoa’s William O’Rourke: Ethical Business Practices, from Russia to Sustainability,” Carnegie Council, 27 April 2011; A. Graham, “The
Thought Leader Interview: William J. O’Rourke,” strategy+business, Winter 2012, 1–7; The Wheatley Institution, “Seek True North: Stories on Leadership
and Ethics — Bill O’Rourke,” (YouTube, 2 August 2016), https://www.youtube.com/watch?v=bmFDXecIqJM, Video (accessed 24 January 2017).
probability that those good or bad outcomes will occur, and
(c) how many people will be affected.49 This is a variation of
the classic expectancy-valence decision model that is applied
in many organizational behaviour concepts, including attitudes (Chapter 4), employee motivation (Chapter 5), and
rational choice decision making (Chapter 7).
Moral Sensitivity
Moral sensitivity (also called ethical sensitivity) is a person’s ability to detect a moral dilemma and estimate its relative importance.50 It is a
characteristic of the decimoral sensitivity A persion maker, not of the sitson’s ability to recognize the
presence of an ethical issue
uation. People with high
and determine its relative
moral sensitivity can more
quickly and accurately estimate the moral intensity of
the issue. This awareness does not necessarily translate into
more ethical behaviour; it just means they are more likely to
be aware when unethical decisions and behaviour occur.
Several factors are associated with a person’s moral
• Expertise or knowledge of prescriptive norms and rules.
Some people are more aware of illegal or unethical
conduct due to their professional training. For example,
accountants are more morally sensitive regarding specific
accounting procedures than are people who lack experience in this profession.
• Previous experience with specific moral dilemmas. Past
incidents generate internal cues that trigger awareness of
future ethical dilemmas with similar characteristics.
• Ability to empathize with those affected by the decision.
People with higher empathy for those affected by the
decision would have greater moral sensitivity regarding
the moral intensity of the issue. On average, women have
higher moral sensitivity compared to men, partly because
women tend to have higher empathy.
• A strong self-view of being a morally sensitive person.52
Employees who strongly define themselves by their moral
character (called their moral identity) are more sensitive to
moral dilemmas because they put more energy into maintaining ethical conduct.
• A high degree of
mindfulness A person’s
receptive and impartial attensituational mindfultion to and awareness of the
ness.53 Mindfulness
present situation as well as to
refers to a person’s
one’s own thoughts and emoreceptive and impartions in that moment.
tial attention to and
Chapter Two
Individual Differences: Personality and Values 47
Ethical Behaviour in the Workplace*
of 300 companies across several countries
that are adopting artificial intelligence (AI) have an ethics
committee to review its use (73% of Canadian firms in
the sample have a committee).
of 161,481 Canadian government
employees strongly or somewhat agree
ree that
senior managers in their department or
agency lead by example in ethical behaviour.
of 1,000 Canadians surveyed
believe there is widespread corruption
on within
businesses in this country (60% of Americans
say this about U.S. businesses).
of 766 Canadian employees
surveyed ssay they have felt pressured to
compromise ethical standards (time and
bosses are the two most common pressures).
of more than 18,000
employees surveyed worldwide say they
observed ccorruption in their organization
within the previous 12 months (ranging from
Europe to 27% in Africa/Middle East).
14% in Euro
*K. Neuman, “Canadians’ Confidence in National Institutions Steady,” Policy Options, August 2, 2018; L. Greiner, “Canadian Firms Care More about AI Ethics than
U.S.: SAS Survey,” IT World Canada, September 24, 2018; “2018 Public Service Employee Survey: Results for the Public Service” (Ottawa: Government of Canada,
Treasury Board of Canada Secretariat, 2019); G. Donde, K. Somasundaram, and L. Frank, “Ethics at Work: 2018 Survey of Employees: Canada” (London: Institute
of Business Ethics, June 26, 2019); Ethics & Compliance Initiative, “2019 Global Business Ethics Survey -- Workplace Misconduct and Reporting: A Global Look”
(Vienna, VA: Ethics & Compliance Initiative, November 27, 2019).
awareness of the present situation as well as to one’s
own thoughts and emotions in that moment. Mindfulness
increases moral sensitivity because it involves actively
monitoring the environment as well as being sensitive
to our responses to that environment. This vigilance
requires effort as well as skill to receptively evaluate our
thoughts and emotions. Unfortunately, we have a natural
tendency to minimize effort, which leads to less mindfulness. For instance, employees often assume that highly-regarded professionals and executives are being ethical
by virtue of their expertise and reputation, so they don’t
pay attention to possible illegal activity by these people.
Situational Factors
Along with moral intensity and moral sensitivity, ethical
conduct is influenced by the situation in which the conduct
occurs.54 One of the most frequently identified situational
influences for unethical behaviour is pressure from top management. A recent survey of more than 13,000 employees
across 13 countries reported that fully one-third had observed
misconduct and 22 percent had experienced pressure to compromise organizational standards. Canada was not included
in that study, but in another survey one-third of Canadians
strongly or somewhat agreed with this statement: “In my
workplace, delivering results is more important than doing
the right thing.” Twenty-two percent agreed with the statement: “I feel that I have to compromise my own personal
ethics or values to keep my job.”55 Situational factors such as
pressure from management do not justify unethical conduct.
Rather, we need to be aware of these factors so organizations
can reduce their prevalence.
Most large and medium-sized organizations in Canada
and other developed countries apply one or more strategies
to improve ethical conduct. The most common ethics initiative is a code of ethical conduct—a statement about desired
practices, rules of conduct, and philosophy about the organization’s relationship to its stakeholders and the environment.56 These codes are supposed to motivate and guide
employee behaviour, signal the importance of ethical conduct, and build the firm’s trustworthiness to stakeholders.
However, critics suggest that they do little to reduce unethical conduct.
Part Two
Individual Behaviour and Processes
Another strategy to improve ethical conduct is to train
and regularly evaluate employees about their knowledge of
proper ethical conduct. Many large firms have annual quizzes to test employee awareness of company rules and practices on important ethical issues such as giving gifts and
receiving sensitive information about competitors or governments. In some firms, employees participate in elaborate
games that present increasingly challenging and complex
moral dilemmas.
A growing ethics practice is a confidential telephone
hotline and website, typically operated by an independent
organization, whereby employees can anonymously report
suspicious behaviour. For instance, Halifax-based conglomerate IMP Group has such a hotline for all employees, suppliers, customers, and other stakeholders. A few very large
businesses also employ ombudspersons who receive information confidentially from employees and proactively investigate possible wrongdoing.
Training, hotlines, and related activities improve ethical
conduct to some extent, but the most powerful foundation
is a set of shared values that reinforces ethical conduct. “A
good, ethical system requires more than just signposts pointing employees in the right direction,” advises the Canadian
Centre for Ethics and Corporate Policy. Instead, ethical
conduct occurs through “a set of beliefs, values, norms and
practices that comprise an ethical culture.” As we describe
in Chapter 14 (organizational culture), an ethical culture is
supported by the conduct and vigilance of corporate leaders.
By acting with the highest moral standards, leaders not only
gain support and trust from followers; they role-model the
ethical standards that employees are more likely to follow.57
Values across Cultures
Values differ not only among individuals and across organizations. They also vary across entire societies. In this section,
we introduce five values that have cross-cultural significance:
individualism, collectivism, power distance, uncertainty
avoidance, and achievement-nurturing orientation. Exhibit
2.5 summarizes these concepts and lists a sample of countries that have high, medium, or low scores on these values.
Two seemingly inseparable cross-cultural values
are individualism and collectivism. Individualism
is the extent to which we
value independence and
individualism A cross-cultural
value describing the degree
to which people in a culture
emphasize independence
and personal uniqueness.
Five Cross-Cultural Values
Sample Countries
Representative Beliefs/Behaviours in “High” Cultures
High: Canada, United States, Chile, South
Africa Medium: Japan, Denmark Low: Taiwan,
Defines self more by one’s uniqueness; personal goals have
priority; decisions have low consideration of effect on others;
relationships are viewed as more instrumental and fluid.
High: Israel, Taiwan Medium: India, Denmark
Low: Canada, United States, Germany, Japan
Defines self more by one’s in-group membership; goals of
self-sacrifice and harmony have priority; behaviour regulated
by in-group norms; in-group memberships are viewed as stable
with a strong differentiation with out-groups.
Power Distance
High: India, Malaysia Medium: Canada, United
States, Japan Low: Denmark, Israel
Reluctant to disagree with or contradict the boss; managers are
expected and preferred decision makers; perception of dependence (versus interdependence) with the boss.
Uncertainty Avoidance
High: Belgium, Greece Medium: Canada, United
States, Norway Low: Denmark, Singapore
Prefer predictable situations; value stable employment,
strict laws, and low conflict; dislike deviations from normal
High: Austria, Japan Medium: Canada, United
States, Brazil Low: Sweden, Netherlands
Focus on outcomes (versus relationships); decisions based on
contribution (equity versus equality); low empathy or showing
emotions (versus strong empathy and caring).
Chapter Two
Individual Differences: Personality and Values 49
How much do you value individualism and collectivism? You can discover your level of individualism
and collectivism by completing this self-assessment in Connect.
What is your level of power distance? You can discover your power distance orientation by
completing this self-assessment in Connect.
personal uniqueness. Highly individualist people value
personal freedom, self-sufficiency, control over their own
lives, and appreciation of the unique qualities that distinguish them from others. Canadians, Americans, Chileans,
and South Africans generally exhibit high individualism,
whereas Taiwan and Venezuela are countries with low individualism.58 Collectivism
is the extent to which we
collectivism A cross-cultural
value our duty to groups
value describing the degree
to which we belong and
to which people in a culture
to group harmony. Highly
emphasize duty to groups
collectivist people define
to which they belong and to
group harmony.
themselves by their group
memberships, emphasize
their personal connection
to others in their in-groups, and value the goals and well-being of people within those groups.59 Low collectivism countries include Canada, Japan, and Germany, whereas Israelis
and Taiwanese have relatively high collectivism.
Contrary to popular belief, individualism is not the opposite of collectivism. In fact, the two concepts are typically
uncorrelated.60 For example, cultures that highly value duty
to one’s group do not necessarily give a low priority to personal freedom and uniqueness. Generally, people across all
cultures define themselves by both their uniqueness and
their relationship to others. It is an inherent characteristic of
everyone’s self-concept, which we discuss in the next chapter. Some cultures emphasize uniqueness over group obligations or vice versa, but both have a place in a person’s values
and self-concept.
Also note that people in Japan have relatively low collectivism. This is contrary to the view stated in many cross-cultural books, which claim that Japan is one of the most
collectivist countries on the planet! There are several explanations for the historical misinterpretation, ranging from
problems defining and measuring collectivism to erroneous
reporting of early cross-cultural research. Whatever the reasons, studies consistently report that people in Japan tend to
have relatively low collectivism and moderate individualism
(as indicated in Exhibit 2.5).61
Power distance refers to
power distance A cross-culthe extent to which people
tural value describing the
accept unequal distribudegree to which people in a
tion of power in a society.
culture accept unequal distriIndividuals with high power
bution of power in a society.
distance accept and value
unequal power. Those in
higher positions expect obedience to authority; those in lower
positions are comfortable receiving commands from their superiors without consultation or debate. People with high power
distance also prefer to resolve differences through formal procedures rather than direct informal discussion. In contrast, people
with low power distance expect relatively equal power sharing.
They view the relationship with their boss as one of interdependence, not dependence; that is, they believe their boss is also
dependent on them, so they expect power sharing and consultation before decisions affecting them are made. People in India
and Malaysia tend to have high power distance, whereas people in Denmark and Israel generally have low power distance.
Canadians collectively have medium-low power distance.
Uncertainty avoidance is
uncertainty avoidance A
the degree to which peocross-cultural value describple tolerate ambiguity (low
ing the degree to which
uncertainty avoidance) or
people in a culture tolerate
feel threatened by ambiguambiguity (low uncertainty
ity and uncertainty (high
avoidance) or feel threatened
by ambiguity and uncertainty
uncertainty avoidance). Em(high uncertainty avoidance).
ployees with high uncertainty avoidance value stru­
ctured situations in which rules of conduct and decision making
are clearly documented. They usually prefer direct rather than
indirect or ambiguous communications. Uncertainty avoidance
tends to be high in Belgium and Greece and very high in Japan.
It is generally low in Denmark and Singapore. Canadians collectively have medium-low uncertainty avoidance.
Part Two
Individual Behaviour and Processes
orientation reflects a competitive versus cooperative
view of relations with other
people.63 People with a high
value assertiveness, competitiveness, and materialism. They appreciate people who are tough, and they favour the
acquisition of money and material goods. In contrast, people in
cultures with low achievement orientation (i.e., high nurturing
orientation) emphasize relationships and the well-being of others. They focus on human interaction and caring rather than
competition and personal success. People in Sweden, Norway,
and the Netherlands score very low on achievement orientation (i.e., high nurturing orientation). In contrast, very high
achievement orientation scores have been reported in Japan
and Austria. Canada and the United States place a little above
the middle of the range on achievement-nurturing orientation.
achievement-nurturing orientation A cross-cultural
value describing the degree
to which people in a culture
emphasize competitive versus cooperative relations with
other people.
Cross-cultural organizational research has gained considerable attention over the past two decades, likely due to increased
globalization and cultural diversity within organizations. Our
knowledge of cross-cultural dynamics has blossomed, and
many of these findings will be discussed in other chapters,
such as leadership, conflict, and influence. However, we also
need to raise a few warning flags about cross-cultural knowledge. One problem is that too many studies have relied on
small, convenient samples (such as students attending one
university) to represent an entire culture.64 The result is that
many cross-cultural studies draw conclusions that might not
generalize to the cultures they intended to represent.
A second problem is that cross-cultural studies often assume
that each country has one culture.65 In reality, many countries (including Canada) have become culturally diverse. As
more countries embrace globalization and multiculturalism, it
becomes even less appropriate to assume that an entire country
has one unified culture. A third concern is that cross-cultural
research and writing continues to rely on a major study conducted almost four decades ago of 116,000 IBM employees
across dozens of countries. That study helped to ignite subsequent cross-cultural research, but its findings are becoming out
of date as values in some cultures have shifted over the years.66
Some cross-cultural studies give the impression that Canada
is a homogeneous country where people hold identical or
very similar values. Of course, anyone who lives here knows
otherwise. Canada is the first country in the world to officially embrace multiculturalism.67 But in addition to the
surface-level diversity reflected in multiculturalism, most
Global Connections 2.4
Japanese alcoholic beverage company Suntory
Holdings Ltd. has a few cross-cultural hiccups to go
through after acquiring Jim Beam, a bourbon producer
in Kentucky. “We have to overcome the huge differences in the Japanese mentality and the American
mentality,” Suntory CEO Takeshi Niinami advised soon
after the acquisition. “It creates misunderstandings.”
Niinami (in photo) says he prefers the “blunt but honest”
American approach, but that style may conflict with the
Japanese preference for modesty, detail, and consensus.
Compared to Americans, Japanese employees are also
more likely to have expectations of lifetime employment
and less incentivized reward systems. “Beam and Suntory
definitely have differences,” Niinami acknowledges. “This
is not an easy task. But I’m ready for it.”
©Bloomberg/Getty Images
* T. Mickle and E. Pfanner, “Jim Beam’s New Owner Mixes Global Cocktail,” Wall Street Journal, May 4, 2015, A1; K. Moritsugu, “Merging US, Japan Work
Cultures a Challenge for Beam Suntory,” Associated Press, January 15, 2016.
Chapter Two
Canadians may be surprised at how much deep-level diversity also exists within this country.
The best-known deep-level cultural differences are
between Canadian anglophones and francophones. At one
time, francophones were more religious, traditional, and deferential to authority, compared with anglophones. Now, the
situation is almost reversed. Relative to anglophones, francophones have significantly less deference to authority, less
acceptance of Canada’s military activities abroad, and more
tolerance and morally permissive views regarding marriage,
sexual activity, and nonmarried parenthood.68 At the same
time, anglophone and francophone Canadians seem to be
converging on several values associated with the workplace,
secularism, and environmentalism.69
Canada’s cultural diversity is further evident in the values of its Indigenous communities and their businesses.
Indigenous people in Canada are far from homogeneous;
there are hundreds of such communities, most of which have
unique histories and experiences. Yet, several studies reveal
that Indigenous Canadians share some common cultural values. Four values mentioned most often are:70
• High collectivism. Relationships represent one of the
most frequently mentioned cultural values in Indigenous
communities. Interconnectedness of community members, including employees within organizations, is highly
valued. This is also part of holistic thinking about the
community’s connection with nature.
• Low power distance. Indigenous communities place
a high priority on consensus and thereby reduce the
leader’s control over group decisions. Indigenous organizations are also noted for decentralized (rather than
hierarchical) leadership, in which the many dimensions
and duties of this role are shared among several people.
Although Indigenous cultures value respect for elders,
those in power are more likely to defer to the group’s
wishes than we usually find in European-based cultures.
• Non-interference. Most Indigenous cultures in Canada
emphasize trust and forgiveness, which includes avoiding
the temptation to direct others down a particular path.
This is associated with low power distance, because
attempting to influence people involves applying your
power over them. Non-interference is also associated
with the tendency to avoid conflict (at least within the
community). One expert observes that in Indigenous
communities “displeasure is not typically displayed by
explicit and open disapproval of another’s actions.”
• Natural time orientation. Indigenous cultures tend to view
time as less structured than in European cultures. This
difference may be due to historic dependence on nature for
survival. Natural time orientation places greater emphasis
on patience to act when conditions are right according to
the situation or to act when it is necessary. This orientation
Individual Differences: Personality and Values 51
also implies that forcing things to happen according to a
schedule is less successful (and less natural).
Cultural geographers have also reported differences in personal
values and personality traits across Canadian regions. Rigorous
analysis has been limited, but a few studies have recently found
that egalitarianism (preference for minimal income differences)
is significantly higher throughout Atlantic Canada and Quebec
than in Alberta, and that personal responsibility and market liberalism (free market capitalism) are stronger in all three prairie
provinces than elsewhere in Canada.71 Significant differences in
the Big Five personality traits have been reported across regions
of the United States and United Kingdom. There is no comparable
research in Canada, but one study suggests that openness to experience and emotional stability are highest in British Columbia
and lowest in Quebec.72 Personal values differ across regions
because regional institutions—such as local governments, educational systems, and dominant religious groups—have a greater
influence than do national institutions on socialization practices.
Studies also suggests that people migrate to places that are more
compatible with their values and self-views.73
Canadian versus American Values
Canadians increasingly shop at American-owned stores and
have close associations with friends and co-workers in the
United States. Yet, the values held by people in these two
countries are more divergent today than a few decades ago.
“Canadians may like Americans, speak the same language,
and consume more of their fast food and popular culture, but
we embrace a different hierarchy of values,” writes social
policy researcher Michael Adams.74 Another Canadian cultural expert suggests that the 49th parallel border is more
than just an imaginary geographic division; it is a symbol of
the widening ideological divide in North America.75
Canadians and Americans are similar in many ways, but
they have also consistently differed over the years on several
key values. One difference, reported in several studies, is that
Canadians have significantly higher tolerance or moral permissiveness than do Americans. This is reflected in greater
acceptance of nontraditional families and of multicultural
immigration. Canadians are also more willing to allow collective rights over individual rights and are less accepting of
large wealth differences within society. Another cultural difference is that Canadians are much less likely than Americans
to be associated with a religious institution and to believe that
these institutions should influence public policy. Canadians
are also much more likely to believe that organizations work
better without a single leader. Perhaps the most significant difference in values between the two countries is in beliefs about
patriarchal authority. In the early 1980s, more than 40 percent
of Canadians and Americans agreed that the father should be
the master of the home. Today, 24 percent of Canadians hold
this view, compared to 41 percent of Americans.76
Part Two
Individual Behaviour and Processes
Chapter Summary
Define personality and discuss how the Big Five personality
factors relate to workplace behaviour and performance.
Personality refers to the relatively enduring pattern of thoughts,
emotions, and behaviours that characterizes a person, along with the
psychological processes behind those characteristics. Personality is
formed through heredity (nature) as well as socialization (nurture).
The Big Five personality factors include conscientiousness,
agreeableness, neuroticism, openness to experience, and extraversion. Conscientiousness and extraversion are the best overall predictors of job performance in most job groups. Extraversion and
openness to experience are the best predictors of adaptive and proactive performance. Emotional stability (low neuroticism) is also
associated with better adaptivity. Conscientiousness and agreeableness are the two best personality predictors of organizational citizenship and (negatively) counterproductive work behaviours.
Four issues to consider about the Big Five personality factors
is that (a) people with higher personality levels aren’t necessarily
the best performers, (b) specific personality traits are sometimes
better predictors of behaviour than are the broader Big Five factors, (c) personality changes to some extent over a person’s lifetime,
and (d) the five-factor model doesn’t cover all of an individual’s
Describe the dark triad of personality and the MBTI types and
discuss their implications for organizational behaviour.
The dark triad is a cluster of three socially undesirable personality
traits: Machiavellianism, narcissism, and psychopathy. They have a
common core of low humility/honesty or a tendency to malevolently
undermine others to maximize one’s own gains. Machiavellianism
refers to people who demonstrate a strong motivation to achieve
their own goals at the expense of others, who believe that deceit
is a natural and acceptable way to achieve their goals, who take
pleasure in outwitting and misleading others using crude influence
tactics, and who have a cynical disregard for morality. Narcissism
is a personality trait of people with a grandiose, obsessive belief
in their superiority and entitlement, a propensity to aggressively
engage in attention-seeking behaviours, an intensive envy of others,
and tendency to exhibit arrogance, callousness, and exploitation of
others for personal aggrandizement. Psychopathy refers to people
who ruthlessly dominate and manipulate others without empathy
or any feelings of remorse or anxiety, use superficial charm, yet
are social predators who engage in antisocial, impulsive, and often
fraudulent thrill-seeking behaviour. People with the dark triad personality engage in more organizational politics, white-collar crime,
workplace aggression, and (to some degree) counterproductive
work behaviours and poor team behaviour. They also make riskier
decisions, resulting in poorer investment returns. However, the dark
triad personality is also associated with manipulative political skill
that can lead to higher performance reviews, more central positions
in employee networks, and better pay.
Based on Jungian personality theory, the Myers-Briggs Type
Indicator (MBTI) identifies competing orientations for getting
energy (extraversion versus introversion), perceiving information
(sensing versus intuiting), processing information and making decisions (thinking versus feeling), and orienting to the external world
(judging versus perceiving). The MBTI improves self-awareness for
career development and mutual understanding but is more popular
than valid.
Summarize Schwartz’s model of individual values and discuss
the conditions where values influence behaviour.
Values are stable, evaluative beliefs that guide our preferences for
outcomes or courses of action in a variety of situations. Compared
to personality traits, values are evaluative (rather than descriptive),
more likely to conflict, and formed more from socialization than
heredity. Schwartz’s model organizes 57 values into a circumplex of
10 dimensions along two bipolar dimensions: openness to change
to conservation and self-enhancement to self-transcendence. Values
influence behaviour in three ways: (1) shaping the attractiveness
of choices, (2) framing perceptions of reality, and (3) aligning
behaviour with self-concept and self-presentation. However, the
effect of values on behaviour also depends on whether the situation
supports or prevents that behaviour and on how actively we think
about them and understand their relevance to the situation. Values
congruence refers to how similar a person’s values hierarchy is to
the values hierarchy of another source (organization, team, etc.).
Describe four ethical principles and discuss three factors that
influence ethical behaviour.
Ethics refers to the study of moral principles or values that determine whether actions are right or wrong and outcomes are good
or bad. Four ethical principles are utilitarianism (greatest good for
the greatest number), individual rights (upholding natural rights),
distributive justice (same or proportional benefits and burdens), and
ethic of care (the moral obligation to help others). Ethical behaviour
is influenced by the degree to which an issue demands the application of ethical principles (moral intensity), the individual’s ability to recognize the presence and relative importance of an ethical
issue (moral sensitivity), and situational forces. Ethical conduct
at work is supported by codes of ethical conduct, mechanisms for
communicating ethical violations, the organization’s culture, and
the leader’s behaviour.
Describe five values commonly studied across cultures and
discuss the diverse cultures within Canada.
Five values commonly studied across cultures are individualism
(valuing independence and personal uniqueness); collectivism (valuing duty to in-groups and to group harmony); power distance (valuing unequal distribution of power); uncertainty avoidance (tolerating
or feeling threatened by ambiguity and uncertainty); and achievement-nurturing orientation (valuing competition versus cooperation).
Canada is a multicultural society, which includes both surface-level and deep-level diversity. Anglophones and francophones
differ with respect to several values (deference to authority, moral
Chapter Two
permissiveness, etc.), but they converge on others. Canada’s many
Indigenous communities are quite diverse but have some degree
of common values regarding high collectivism, low power distance, non-interference, and natural time orientation. All regions in
Canada differ from one another on some values (e.g., egalitarianism
Individual Differences: Personality and Values 53
and personal responsibility) and personality traits (e.g., openness to
experience). Canadians and Americans are similar in many ways,
but they also have long-standing cultural differences, particularly
regarding the values of tolerance, collective rights, secularism, and
patriarchal authority.
Key Terms
achievement-nurturing orientation
counterproductive work behaviours (CWBs)
dark triad
five-factor (Big Five) model
moral intensity
moral sensitivity
Myers-Briggs Type Indicator (MBTI)
openness to experience
organizational politics
power distance
uncertainty avoidance
Critical Thinking Questions
1. Studies report that heredity has a strong influence on an
individual’s personality. What are the implications of this
in organizational settings?
2. All candidates applying for a management trainee position are given a personality test that measures the five
dimensions in the five-factor model. Which personality
traits would you consider to be the most important for
this type of job? Explain your answer.
3. As head of product development for mobile telephones,
you are about to hire someone to assist in the human
interface features of product design. The nature of this
work calls for a creative, “break out of the box” thinker
who works well in a team setting. Five short-listed applicants have completed a valid measure of the Big Five
personality factors. If these applicants all have similar
intelligence and work experience, which Big Five personality factors would best predict job performance (you
may select one or more factors). Which Big Five factor
would be least relevant? Justify your answer.
4. The dark triad is understandably a personality cluster of
great concern in organizations. Yet, even though it consists
of three socially undesirable personality traits, there is evidence that senior executives are more likely than the rest of
us to possess some of these traits. Why would this occur?
Does this mean that the dark triad isn’t so bad after all?
5. This chapter discussed values congruence mostly in
the context of an employee’s personal values versus the
organization’s values. But values congruence also relates to
the juxtaposition of other pairs of value systems. Explain
how values congruence is relevant with respect to organizational versus professional values (i.e., values of a professional
occupation, such as physician, accountant, pharmacist).
6. The CEO and two other executives at an automotive parts
manufacturer were recently fired after being charged with
fixing prices on several key automotive parts sold to the auto
industry. Executives at competing manufacturers face the
same charges for also participating in this collusion. Profit
margins have come under intense pressure in the industry,
which could cause one or more auto parts firms (possibly
this company) to go bankrupt. When the wrongdoing was
discovered, most employees involved in product pricing
(but not implicated in price fixing) were surprised. The
executives were highly respected in their fields of expertise,
so many staff members interpreted the unusual pricing decisions as a new strategy, not an illegal activity. Apply your
knowledge of personal and ethical values and behaviour to
explain why the unethical activity may have occurred.
7. “All decisions are ethical decisions.” Comment on this
statement, particularly by referring to the concepts of
moral intensity and moral sensitivity.
8. People in a particular South American country have high
power distance and high collectivism. What does this
mean, and what are the implications of this information
when you (a senior executive) visit employees working
for your company in that country?
Part Two
Individual Behaviour and Processes
Case Study:
by Steven L. McShane, University of Newcastle (Australia)
Bribery of foreign public officials, conspiracy to commit
fraud and forgery, money laundering, possessing property
obtained by crime, and attempts to secretly smuggle the son
of a former dictator into safer countries. Sounds like the
plot of a twisted crime novel. Yet these are the charges laid
against former executives at SNC-Lavalin (SNCL), one of
Canada’s largest engineering and construction firms.
The Royal Canadian Mounted Police allege that over
the past decade SNCL funnelled $118 million through offshore bank accounts as bribes to secure contracts in Libya.
Separately, the World Bank, the African Development Bank,
Swiss police, and other entities uncovered evidence that
SNCL bribed or attempted to bribe government staff and
leaders to win contracts in Africa and Asia. SNCL is also
being investigated for unethical activities in contract bidding
on a major Canadian project involving a Montreal superhospital. Almost a dozen former SNCL executives, most of
whom held senior positions, either face charges of criminal
activity or are under investigation. The company and its 100
subsidiaries have been banned for a decade from bidding on
World Bank–funded contracts.
The World Bank and other investigators report that
in several contracts SNCL processed bribes through an
expense line called “project consultancy cost” or PCC.
For example, SNCL settled a corruption case filed by the
African Development Bank, which had discovered project
consultancy cost items representing 7.5 percent of the total
contract value of two SNCL road projects in Uganda and
Mozambique. The engineering firm has acknowledged that
none of these expenses were legitimate. “Everybody used
this term, and all know what that means,” admits SNCL’s
former director of international projects. “Sometimes it was
‘project consultancy cost,’ sometimes ‘project commercial
cost,’ but [the] real fact is the intention is [a] bribe.”
SNCL paid many of the PCC bribes indirectly through
employees. One SNCL engineer in Nigeria said he was
told to use his personal funds to pay a Nigerian official for
a “soils investigation.” The official had selected the engineering firm for a contract. The engineer was subsequently
reimbursed by SNCL through a fictitious company. When
asked why he participated in the kickback scheme, the engineer (who now works in India for another company) replied:
“When the boss asks, in that part of the world. . .what would
you do if you were put in my shoes if you were in a remote
area of Nigeria?”
Another way that SNCL executives apparently bribed
officials was through “agent fees.” Retaining a local agent is
common and sometimes required for foreign contracts bids
to arrange permits, imports, and other activities. However,
investigators uncovered numerous questionable transfers
of large funds from SNCL to banks in Switzerland, the
Bahamas, and other countries, allegedly for agent fees.
The largest corruption of the “agent fee” process involved
SNCL transferring more than $120 million over 10 years
to a Swiss bank account controlled by an SNCL executive
vice-president working in North Africa and later at headquarters in Montreal. The executive was subsequently convicted
and served jail time in Switzerland for corruption and money
laundering regarding these funds, $47 million of which he
handed over to Swiss authorities as part of that conviction.
During the Swiss trial, the executive admitted that he bribed
Saadi Gaddafi, a son of Libya’s dictator at that time, for the
purpose of having SNCL win five major contracts in Libya.
In separate charges, an RCMP affidavit claims that the same
executive masterminded a failed attempt to smuggle Saadi
Gaddafi and his family into Mexico. A former SNCL contractor in Canada spent 18 months in a Mexican prison in
relation to that mission.
SNCL is suing the executive convicted in Switzerland
and others for recovery of the transferred funds, claiming
that they were intended as legitimate agent fees. The executive counterclaims that the top brass (below the board level)
had arranged or knew these funds were being used for bribery payments and that the executive was following orders.
Separate actions by SNCL’s CEO at the time lend support to
the jailed executive’s claims. Specifically, in spite of opposition from the chief financial officer and head of international
operations, the CEO authorized undocumented payments
totalling $56 million to unknown “agents” in Libya and the
Bahamas. Quebec’s anti-corruption police say the CEO’s
largest undocumented payment ($22.5 million sent to the
Bahamas) was a bribe to win a major Montreal superhospital contract. The CEO resigned when an internal review
informed SNCL’s board of the CEO’s actions. The board
granted the CEO a severance payout, but those payments
were later stopped when Quebec’s anti-corruption police
charged the former CEO with fraud.
Another SNCL vice-president now facing several charges
also admits to engaging in bribery and related crimes. He
explained that SNC-Lavalin had “a corporate culture where it
was common practice to do all that was necessary, including
the payment of ‘commissions’ and other benefits to obtain
contracts, including in Libya.” The second executive also
argued that he was under pressure to engage in these illegal
activities because the executive above him said “that he had
to follow their orders to satisfy their expectations.” In fact, a
Chapter Two
few former SNCL executives have since tried to sue the company for wrongful dismissal on the grounds that their illegal
activities were required by the company to keep their jobs.
SNCL’s board of directors seems to have downplayed personal responsibility for these events. Very early in the RCMP
investigation, SNCL’s board received an anonymous internal letter describing the bribery activities, yet the board later
admitted that it only “took note” of the allegations, pointing
out that they have “received anonymous letters before that
have no credibility.” And when the extent of wrongdoing
at SNCL eventually became public, the board chair said:
“Clearly, our board of directors can’t govern something that
they don’t know about, or prevent something they are not
aware of.”
Individual Differences: Personality and Values 55
Discussion Questions
1. Explain how moral sensitivity and moral intensity apply
to the unethical behaviour among several SNC-Lavalin
executives and other staff.
2. This case describes several incidents of unethical and
illegal behaviour at SNC-Lavalin. To what extent did
motivation, ability, role perceptions, and situation (i.e.,
MARS model from Chapter 1) influence this behaviour
among executives and employees? How did the personal
values of these people affect their actions?
3. What steps should SNC-Lavalin and other companies in
this situation take to minimize these types of corporate
Team Exercise:
by Steven L. McShane, University of Newcastle (Australia)
Purpose This exercise is designed to make you aware of the
ethical dilemmas people face in various business situations,
as well as the competing principles and values that operate in
these situations.
Instructions (Small Class) The instructor will form teams
of four or five students. Team members will read each case
below and discuss the extent to which the company’s action
in each case was ethical. Teams should be prepared to justify their evaluation using ethics principles and the perceived
moral intensity of each incident.
Instructions (Large Class) Working alone, read each
case below and determine the extent to which the company’s action in each case was ethical. The instructor will use
a show of hands to determine the extent to which students
believe the case represents an ethical dilemma (high or low
moral intensity) and the extent to which the main people or
company in each incident acted ethically.
A large multinational grocery chain that emphasizes healthy
lifestyles is recognized as one of the nation’s “greenest”
companies, has generous employee benefits, and is perennially rated as one of the best places to work. Employees
receive a 20 percent discount on company products.
However, those who participate in the company’s voluntary
“Healthy Discount Incentive Program” receive up to an additional 10 percent discount on their purchases (i.e., up to a
total 30 percent discount). These additional discounts are
calculated from employees’ blood pressure, total cholesterol
(or LDL) levels, Body Mass Index (BMI), and nicotine-free
lifestyle. For example, the full additional 10 percent discount is awarded to those who do not use nicotine products,
have 110/70 or lower blood pressure, have cholesterol levels
under 150, and have a BMI of less than 24. Employees do
not receive the additional discount if they use nicotine products, or have any one of the following: blood pressure above
140/90, cholesterol of 195 or higher, or BMI of 30 or higher.
In his letter to employees when announcing the plan, the
CEO explained that these incentives “encourage our Team
Members to be healthier and to lower our healthcare costs.”
A 16-year-old hired as an office administrator at a small
import services company started posting her thoughts
about the job on her Facebook site. After her first day, she
wrote: “first day at work. omg!! So dull!!” Two days later,
she complained “all i do is shred holepunch n scan paper!!!
omg!” Two weeks later she added “im so totally bord!!!”
These comments were intermixed with the other usual banter about her life. Her Facebook site did not mention the
name of the company where she worked. Three weeks after
being hired, the employee was called into the owner’s office,
where he fired her for the comments on Facebook, then had
her escorted from the building. The owner argues that these
comments put the company in a bad light, and her “display
of disrespect and dissatisfaction undermined the relationship
and made it untenable.”
The waiter at a café in a large city mixed up Heidi Clarke’s
meal order with the meal that a male customer at a nearby
Part Two
Individual Behaviour and Processes
table had requested. The two strangers discovered the mistake
and briefly enjoyed a friendly chat while swapping plates.
The male patron departed soon after but accidentally left his
new tuxedo jacket behind on his chair. Clarke wanted to meet
him again, so she took the jacket home. Following a friend’s
suggestion, Heidi launched a YouTube video and website, in
which she shyly told her story, detailed the jacket’s features,
and prominently displayed a label with the name of a popular
fashion retailer. The website even included photos of Heidi
posing in the jacket. The next day, she gave the café staff the
jacket and a note with her name and phone number. Heidi’s
YouTube video soon went viral, her website crashed from
so many visitors, and a major newspaper and television station featured Heidi’s quest to find the man with the missing
jacket. The incident is a romantic reversal of the Cinderella
story . . . except it was a fake event staged by a marketing
company. “Heidi” is an actress and model hired by the marketer to promote the fashion retailer’s new line of jackets for
men. A partner at the marketing firm justified the hoax by
saying that “when you’ve got a very well­-established brand
you need to do something that’s got talkability and intrigue
to reassess what that brand is about.” The marketing executive argued that this was an acceptable marketing event
because “nobody’s been harmed” and the firm intended to
eventually reveal the truth. Indeed, the actress (whose real
name is Lily, not Heidi) released a second video acknowledging that the incident was fake and explaining that she’s a
hopeless romantic who loves a good love story.
Computer printer manufacturers usually sell printers at a low
margin over cost and generate much more income from subsequent sales of the high-margin ink cartridges required for
each printer. One global printer manufacturer now designs its
printers so that they work only with ink cartridges made in
the same region. Ink cartridges purchased in Canada will not
work with the same printer model sold in Europe, for example. This “region coding” of ink cartridges does not improve
performance. Rather, it prevents consumers and grey marketers from buying the product at a lower price in another
region. The company says this policy allows it to maintain
stable prices within a region rather than continually changing
prices due to currency fluctuations.
A large European bank requires all employees to open a bank
account with that bank. The bank deposits employee paycheques to those accounts. The bank explains that this is a
formal policy which all employees agree to at the time of hire.
Furthermore, failure to have an account with the bank shows
disloyalty, which could limit the employee’s career advancement opportunities with the bank. Until recently, the bank
has reluctantly agreed to deposit paycheques to accounts at
other banks for a small percentage of employees. Now, bank
executives want to reinforce the policy. They announce that
employees have three months to open an account with the
bank or face disciplinary action.
Class Exercise:
by Steven L. McShane, University of Newcastle (Australia)
Purpose This exercise is designed to help you understand
Schwartz’s values model and relate its elements to your personal values and the values held by others in your class.
Instructions Your instructor will distribute a sheet with 44
words and phrases representing different personal values.
Read these words and phrases carefully, then follow these
1. Pick THREE (3) of these words/phrases that represent the
MOST important values to you personally. Print each of the
three values on the three yellow-coloured sticky (Post-It)
notes provided by your instructor (i.e., print one value on
each note). Do not put your name on any sticky notes.
2. From the remaining 41 values on the sheet provided by
your instructor, pick THREE (3) of these that represent
the LEAST important values to you personally. Print
each of the three values on three sticky notes of the second colour provided by your instructor (i.e., print one
value on each note).
3. The instructor will advise you what to do with the six
sticky notes on which you wrote your most and least
important values.
4. The class will engage in a debriefing, using the information created in the third step of this activity.
Chapter Two
Individual Differences: Personality and Values 57
Self-Assessments for Chapter 2
What is your Big Five
Personality experts have organized the dozens of personality traits into five main dimensions, known
as the five-factor or “Big Five” model. Each dimension consists of several specific personality traits
that cluster together. Most scholarly research on personality relies on this model, but it is also useful in
everyday life as a relatively easy categorization of personalities. This self-assessment estimates your
personality on the Big Five dimensions.
Are you introverted or
One of the most widely studied and discussed personality dimensions is introversion–extraversion.
Introversion characterizes people who tend to be quiet, shy, and cautious. Extraversion characterizes
people who tend to be outgoing, talkative, sociable, and assertive. This self-assessment estimates the
extent to which you have an introverted or extraverted personality.
Can you identify
personality traits from
blogging words?
Personality influences all aspects of our lives, including the words we use when writing blogs. In fact,
some companies now use sophisticated software to estimate the personality traits of job applicants
from the words they use in blogs and other online writing. This self-assessment estimates how well you
interpret someone’s personality in blogs and other writing.
How Machiavellian
are you?
Machiavellianisn is a personality trait characteristic of people who demonstrate a strong motivation
to achieve their own goals at the expense of others, who believe that deceit is a natural and acceptable
way to achieve their goals, who take pleasure in outwitting and misleading others using crude influence
tactics, and who have a cynical disregard for morality. Few people want to be viewed as Machiavellian,
yet many of us exhibit aspects of this trait to some extent. This self-assessment estimates the extent to
which you believe that you have Machiavellian tendencies.
Are you a sensing or
intuitive type?
Nearly a century ago, Swiss psychiatrist Carl Jung proposed that personality is primarily represented by
the individual’s preferences regarding perceiving and judging information. Jung explained that perceiving, which involves how people prefer to gather information or perceive the world around them, occurs
through two competing orientations: sensing (S) and intuition (N). This self-assessment estimates your
score on this Jungian personality type (S/N).
What are your dominant
Values are stable, evaluative beliefs that guide our preferences for outcomes or courses of action in a
variety of situations. They are perceptions about what is good or bad, right or wrong. We arrange our
personal values into a hierarchy of preferences, called a value system. Schwartz’s values circumplex
organizes the dozens of personal values into 10 categories placed in a circle (circumplex). This selfassessment assesses the relative importance to you of the 10 categories of values in Schwartz’s
circumplex model.
How much do you
value individualism and
Cross-cultural values have become an important part of organizational life due to globalization and an
increasingly multicultural workforce. Two of the most commonly studied cross-cultural values are individualism and collectivism. This self-assessment estimates your score on these two cross-cultural values.
What is your level of
power distance?
Some employees value obedience to authority and are comfortable receiving commands from their
superiors without consultation or debate. Others expect equal status and authority with their manager.
This power distance orientation varies from one person to the next; it also varies across cultures. This
self-assessment estimates your score on this cross-cultural value.
Perceiving Ourselves and Others in Organizations
After reading this chapter, you should be able to:
LO1 Describe the elements of self-concept and explain how each affects an individual’s
behaviour and well-being.
LO2 Outline the perceptual process and discuss the effects of categorical thinking and
mental models in that process.
LO3 Discuss how stereotyping, attribution, self-fulfilling prophecy, halo, false-consensus,
primacy, and recency effects influence the perceptual process.
LO4 Discuss three ways to improve perceptions, with specific application to
organizational situations.
LO5 Outline the main features of a global mindset and justify its usefulness to employees
and organizations.
Heidi Cossey excelled in math and science
throughout high school in Alberta, but nobody
suggested that she might enjoy a career in engineering. “All I knew is that I wanted to help people,” recalls the geo-environmental engineer. “I
didn’t know you could actually do that in engineering.” And when Cossey began her engineering studies, some of her acquaintances either
showed surprise or expressed doubt about
her success. “I can’t tell you how many people
have told me I should be a hairdresser instead
of an engineer,” she says. “Unfortunately, I think
women will still have to prove themselves for a
Stereotypes, discrimination, and other misperceptions are
while yet.”
a few of the reasons why women are under-represented in
Engineering is considered one of the most
the engineering profession.
fulfilling and well-paying careers. Yet, women
©Monkey Business Images/Shutterstock
represent less than 15 percent of the engineering workforce in Canada (similar to several other
countries) and little more than 20 percent of students enrolled in Canadian engineering programs.
One reason for the alarming under-representation of women is the misguided stereotype of engineering as a traditional male job involving work in physically difficult terrain. One recent survey found
that stereotypes dissuaded 74 percent of Canadian girls from considering a career in engineering and
other STEM occupations. “We need to urgently change the image of women in engineering,” urges
Chapter Three
Perceiving Ourselves and Others in Organizations 59
Michelle Unger, a civil engineer specializing in subsea and pipeline technology. “I do not wear a hard
hat, or work in a muddy field. Very few of us will ever do that.”
Female engineers also face various forms of discrimination and prejudice. For example, a Google engineer in California and the CEO of a South African engineering association recently espoused long-refuted
ideas that women aren’t suited biologically or personality-wise to engineering. “I think a lot of men don’t
realize their own bias to hiring or working with women,” says Bruce Matthews, chief executive of the
Consulting Engineers of Ontario.
Kathy Tarnai-Lokhorst, president of Engineers and Geoscientists of British Columbia, believes that these
perceptual biases and distorted stereotypes will evaporate as the profession develops more female engineer role models. “Seeing oneself represented in the industry where they work can change a person’s
ideas about what they are capable of, and instil a sense of belonging,” she explains. Elly Williams, an
engineering student in Australia, agrees. “I believe that what we need to show young women is that they
don’t have to fit one of society’s constructed stereotypes to be a successful engineer; they just have to be
passionate about creating things to help people.”1
Companies that employ engineers face two challenges in
attracting and keeping women in this profession: (1) the concept women have about themselves as engineers; and (2) the
perceptions they and others have about engineers and about
women in these roles. We discuss both of these related topics
in this chapter. First, we examine how people perceive themselves—their self-concept—and how that self-perception
affects their decisions and behaviour. Next, we focus on perceptions in organizational settings, beginning with how we
select, organize, and interpret information. We also review
several specific perceptual processes, such as stereotyping,
attribution, and self-fulfilling prophecy. This is followed by
discussion of potentially effective ways to improve perceptions. The final section of this chapter reviews the main elements of global mindset, a largely perceptual process valued
in this increasingly globalized world.
Self-Concept: How We Perceive
Why are there so few female engineers in Canada and many
other countries? As the opening case study to this chapter
suggests, many people have inaccurate perceptions about
this profession—associating it with an image that is incompatible with the ideal self-concept for many women. In
addition, as Heidi Cossey observed, young women receive
low-expectation signals from people around them, which
affects their self-evaluation as an engineer. This amplifies
their existing self-doubts regarding performance in engineering-related courses. For instance, one recent study found that
14-year-old girls significantly underestimated their performance on science and technology tests, whereas boys slightly
overrated themselves, even though average scores are about
the same for both genders.2
These barriers to women entering engineering are core
elements of self-concept. Self-concept refers to an individual’s self-beliefs and self-evaluations.3 It is the, Who am I? and
How do I feel about myself?
that people ask themselves and
self-concept An indithat guide their decisions and
vidual’s self-beliefs and
actions. Whether contemplating a career in engineering or
any other occupation, we compare our mental images of that
job with our current perceived self and desired ideal self. We
also evaluate our current and desired abilities to determine
whether they make a good fit with that type of work. Our
self-concept is defined at three levels: individual, relational,
and collective. Specifically, we view ourselves in terms of
our personal traits (individual self), connections to friends
and co-workers (relational self), and roles in teams, organizations, social groups, and other entities (collective self).4
An individual’s self-concept can be described by three
characteristics: complexity, consistency, and clarity
(see Exhibit 3.1). Complexity refers to the number of distinct and important roles or identities that people perceive
about themselves.5 Everyone has some degree of complexity because they see themselves in different roles at various
times (student, friend, daughter, sports fan, etc.). People
are generally motivated to increase their complexity (called
self-expansion) as they seek out new opportunities and social
connections. Your self-concept becomes more complex, for
Part Two
Individual Behaviour and Processes
Self-Concept Characteristics and Processes
• Complexity
• Consistency
• Clarity
example, as you move from being an accountant to a manager because you have acquired additional roles.
Self-concept complexity is defined by more than just the
number of identities a person has; it is also defined by the
separation of those identities. An individual with several
identities might still have low self-concept complexity when
those identities are highly interconnected, such as when
they are all work-related (manager, engineer, family income
earner). Complexity is higher when the multiple identities
have a low correlation with each other, such as when they
apply to fairly distinct spheres of life.
Although everyone has multiple selves, only some of
those identities dominate their attention at any one time.6 A
particular self-view (parent, manager, etc.) is usually domain
specific; it is more likely to be activated in some settings
than in others. People shift their self-concept more easily
when the activated self-view is important and compatible
with the situation. For instance, as people travel from home
to work, they can usually shift their self-view from being a
parent to being an executive because each role is important
and fits into the home and work contexts, respectively. In
contrast, some employees struggle to focus on their occupational self-concept when working from home (remote work).
Consistency, the second self-concept characteristic, is the
degree to which a person’s identities require similar personal
attributes. High consistency exists when the individual’s
personal attributes are compatible with their various selfviews, and when those self-views are compatible with each
other. Low consistency occurs when some self-views require
personal attributes that conflict with attributes required for
other self-views, such as when a safety-conscious engineer
also identifies as a risk-oriented snowboarder. Low consistency also occurs when an individual’s dominant self-views
are incompatible with their actual personal attributes. This
would occur when someone has a self-concept as a highly
creative individual yet has moderately low openness-to-experience personality and values.
The third self-concept characteristic is clarity, which
refers to the degree to which a person’s self-concept is clear,
confidently defined, and stable.7 Clarity occurs when someone is confident about “who I am” and can describe their
identities to others and provide the same description over
time. Self-concept clarity increases with age because personality and values become relatively stable by adulthood
and people develop better self-awareness through life experiences. Self-concept is also clearer when a person’s multiple
selves have higher consistency. This makes sense because
low consistency produces ambiguity about a person’s underlying characteristics. For example, someone whose self-view
includes the contrasting identities of cautious engineer and
risk-oriented snowboarder would have difficulty defining
himself or herself clearly or with much confidence.8
Chapter Three
Perceiving Ourselves and Others in Organizations 61
Global Connections 3.1
Richard Alderson was developing an enviable career
as a business consultant in London after graduating
from university. “On the surface, I had a good job in a
big company,” Anderson recalls. “I’d done what was
expected of me post-university.”
But Alderson eventually realized that this career path
was incompatible with his self-concept. In social gatherings, he would “feel embarrassed about talking about
my work because it wasn’t something that felt aligned
with me. There was nothing wrong with the job or the
company; they simply weren’t right for me,” recalls
Alderson, who has since formed a company offering
coaching and workshops for people who face similar
career incompatibility issues.
Alderson’s experience isn’t unusual. Many people
complete an educational program and enter a career
before their self-concept is clear and confidently defined.
“Your twenties are a time of considerable personality
development and growth—and only at 30 do you start
©Jose Luis Pelaez Inc/Blend Images LLC
to discover who you really are,” suggests Kedge Martin,
the founder of a career development and life-skills
agency in London.
* R. Alderson, “I Felt Numb, Uninspired by My Work and Stuck in Groundhog Day,” The Guardian, October 7, 2015; S. Inge, “New Decade, New Job: How to
Change Career in Your Thirties,” The Telegraph, August 6, 2018.
Effects of Self-Concept Characteristics on
Well-Being and Behaviour
Psychological well-being tends to be higher among people
with fairly distinct multiple selves (complexity) that are well
established (clarity) and require similar personal attributes
that are compatible with the individual’s character (consistency).9 Self-concept complexity protects our self-esteem
when some roles are threatened or damaged. A complex self
is similar to a ship with several compartments that can be
sealed off from one another. If one compartment is damaged,
the other compartments remain intact, so the ship remains
afloat. A complex self offers the same benefits: if one identity
is damaged by events—job loss, for example—the person’s
mental health stays afloat because the other selves remain
intact. In contrast, people with low complexity, including
those whose multiple selves are highly interconnected, suffer severe loss when they experience failure because these
events affect a large part of themselves.
People also tend to have better well-being when their
multiple selves are in harmony with one another and with
their personality and values (consistency).10 Self-concept
complexity helps people adapt, but too much variation
causes internal tension and conflict. Well-being also tends to
increase with self-concept clarity. People who are unsure of
their self-views are more easily influenced by others, experience more stress when making decisions, and feel more threatened by social forces that undermine their self-confidence
and self-esteem.11
Self-concept complexity, consistency, and clarity have
both positive and negative influences on individual behaviour
and performance.12 Employees with complex identities tend
to have more adaptive decision-making and performance.
This likely occurs because multiple selves generate more
diverse experiences and role patterns, so these employees
can more easily alter their thinking and behaviour to suit
new tasks and work environments. A second benefit is that
self-concept complexity often produces more diverse social
networks, which gives employees access to more resources
and social support to perform their jobs.
Against these benefits is the problem that highly complex
self-concepts require more effort to maintain and juggle,
which can be stressful. Low complexity self-concepts, on
the other hand, require less effort and resources to develop.
For example, people who define themselves mainly by their
work (low complexity) tend to have better job performance
due to their longer work hours, more investment in skill
Part Two
Individual Behaviour and Processes
How much does work define your self-concept? You can discover the extent to which work is central
to your self-concept by completing this self-assessment in Connect.
development, and more concentration on work. They also
have lower absenteeism and turnover.
Self-concept clarity tends to improve performance and is
considered vital for leadership roles.13 Clarity also provides
a more lucid career path, which enables people to direct their
effort more efficiently toward career success. Another benefit
is that people with high self-concept clarity feel less threatened by interpersonal conflict, which increases their ability
to resolve conflicts through constructive problem-solving
behaviours. However, those with very high clarity may have
role inflexibility, with the result that they cannot adapt to
changing job duties or environmental conditions.
Along with the three self-concept characteristics,
Exhibit 3.1 identifies four processes that shape self-concept
and motivate a person’s decisions and behaviour. Let’s look at
each of these four “selves”: self-enhancement, self-verification,
self-evaluation, and social self (social identity).
A century ago, educational philosopher John Dewey said
that “the deepest urge in human nature is the desire to be
important.”14 Dewey recognized that people are inherently
motivated to perceive themselves (and to be perceived by
others) as competent, attractive, lucky, ethical, and important.15 This phenomenon, called self-enhancement, is
observed in many ways.
Individuals tend to rate
self-enhancement A person’s
inherent motivation to have
themselves above average,
a positive self-concept (and
believe that they have a betto have others perceive them
ter than average probability
favourably), such as being
of success, and attribute
competent, attractive, lucky,
their successes to personal
ethical, and important.
motivation or ability while
blaming the situation for their mistakes. For instance, one
study reported that 70 percent of students believe their academic performance is above average; 62 percent say they
have above-average leadership ability compared to other
students. People don’t believe they are above average in all
circumstances, only for things that are important to them and
are relatively common rather than rare.16
Self-enhancement has both positive and negative consequences in organizational settings.17 On the positive side,
individuals tend to experience better mental and physical
health when they amplify their self-concept. Overconfidence
also generates a “can do” attitude (which we discuss later)
that motivates persistence in difficult or risky tasks. On the
negative side, self-enhancement causes people to overestimate future returns in investment decisions and to engage
in unsafe behaviour (such as dangerous driving). It also
motivates executives to repeat ineffective decisions (because
they ignore negative feedback), launch misguided corporate diversification strategies, and acquire excessive corporate
debt. Generally, though, successful companies strive to help
employees feel valued, which generates some degree of
Individuals try to confirm and maintain their existing
self-concept.18 This process, called self-verification, stabilizes an individual’s self-view, which, in turn, guides
their thoughts and actions.
Employees actively comself-verification A person’s
municate their self-concept
inherent motivation to confirm
and maintain their existing
so co-workers understand it
and provide verifying feedback when observed. For
example, you might let co-workers know that you are a very
organized person; later, they compliment you on occasions
where you have indeed been very organized. One recent
study reported that when a person’s identity as a leader is
questioned by others, the leader applies self-verification
strategies, such as making their role performance more visible (e.g., working longer hours), adopting a less threatening
style of that self-view, and directly confronting those who
doubt or disagree with their self-view as a leader.19
Unlike self-enhancement, self-verification includes seeking feedback that is not necessarily flattering (e.g., I’m a numbers person, not a people person). Experts continue to debate
whether and under what conditions people prefer information that supports self-enhancement or self-verification.20 In
other words, do we prefer compliments rather than accurate
critiques about weaknesses that we readily acknowledge?
The answer is likely an internal tug-of-war; we enjoy compliments, but less so if they are significantly contrary to our
Self-verification is associated with several OB topics.21
First, it affects the perceptual process because employees
are more likely to remember information that verifies their
self-concept and nonconsciously screen out information
(particularly negative information) that is contrary to their
self-view. Second, people with high self-concept clarity will
consciously dismiss feedback that contradicts their self-view.
Chapter Three
Third, employees are motivated to interact with others who
affirm their self-views, and this affects how well they get
along with their boss and team members.
Almost everyone strives to have a positive self-concept, but
some people have a more positive evaluation of themselves
than do others. This self-evaluation is mostly defined by three
elements: self-esteem, self-efficacy, and locus of control.22
Self-esteem—the extent to which people like, respect, and
are satisfied with themselves—represents a comprehensive
self-evaluation. People have degrees of self-esteem for each
of their various roles, such as believing themselves to be a
good student, a good driver, and a good parent. From these
multiple self-appraisals, people form an overall evaluation of
themselves, known as their global self-esteem. People with
high self-esteem are less influenced by others, tend to persist in spite of failure, and have a higher propensity to think
Self-efficacy refers to a person’s belief that they can successfully complete a task.24 Those with high self-efficacy have
a “can do” attitude. They believe they possess the energy
(motivation), ability, clear
self-efficacy A person’s
expectations (role percepbelief that they have the abiltions), and resources (situity, motivation, correct role
ational factors) to perform
perceptions, and favourable
the task. In other words,
situation to complete a task
self-efficacy is an individsuccessfully.
ual’s perception regarding the MARS model in a specific situation. Self-efficacy
is often task-specific, but it can also be more generalized.
People have a general self-efficacy when they believe they
can be successful across a variety of situations.25 People
with higher general self-efficacy have a more positive overall self-evaluation.
Perceiving Ourselves and Others in Organizations 63
Locus of Control
Locus of control is defined as a person’s general beliefs
about the amount of control they have over personal life
events.26 Individuals with
an internal locus of control
locus of control A person’s
believe that life events are
general belief about the
amount of control they have
caused mainly by their perover personal life events.
sonal characteristics (i.e.,
motivation and abilities).
Those with an external locus of control believe events are
due mainly to fate, luck, or conditions in the external environment. Locus of control is a generalized belief that varies
to some extent with the situation. People with an external
locus of control generally believe that life’s outcomes are
beyond their control, but they also believe they have control
over the results of tasks they perform often. An individual’s
locus of control tendency is most apparent in new situations,
where their ability to control events is uncertain.
People with an internal locus of control have a more positive self-evaluation. They also tend to perform better in most
employment situations, are more successful in their careers,
earn more money, and are better suited for leadership positions. Internals are also more satisfied with their jobs, cope
better in stressful situations, and are more motivated by performance-based reward systems.27
We began this topic by stating that an individual’s
self-concept exists at three levels: individual, relational, and
collective. These three levels recognize two opposing human
motivations that influence how people view themselves.28
• Motivation to be distinctive and different from other
people. The individual self, called personal identity
or internal self-concept, fulfils the need for distinctiveness because it involves defining ourselves by our personality, values, abilities, qualifications, achievements,
and other personal attributes. Everyone has a unique
combination of personal characteristics, and we embrace
this uniqueness to some degree. For instance, an unusual
How much general self-efficacy do you have? You can discover your level of general self-efficacy by
completing this self-assessment in Connect.
What is your locus of control? You can discover your general locus of control orientation by
completing this self-assessment in Connect.
Part Two
Individual Behaviour and Processes
skill or accomplishment that distinguishes you from your
co-workers is part of your personal identity.
• Motivation for inclusion and assimilation with other
people. The relational and collective self-concepts fulfil
the fundamental drive for affiliation because they involve
both interaction and interdependence with others.29
Human beings are social animals; we have an inherent
drive to be associated with others and to be recognized
as part of social communities. This drive to belong
motivates all individuals to define themselves to some
degree by their interpersonal and collective relationships,
a definition known as their social identity or external
Social identity is the foundation of social identity theory,
which says that people define themselves by the groups
to which they belong or have an emotional attachment.30
For instance, someone might
have a social identity as
social identity theory A thea Canadian, a graduate
ory stating that people define
themselves by the groups to
of Université Laval, and
which they belong or have an
an employee at Desjardins
emotional attachment.
Group (see Exhibit 3.2).
Social identity is a
complex combination of many memberships arranged in a
hierarchy of importance. One factor determining importance
is how easily you are identified as a member of the reference group, such as by your gender, age, and ethnicity. A
second factor is your minority status in a group. It is difficult
to ignore your gender in a class where most other students
are another gender, for example. In that context, gender tends
to become a stronger defining feature of your social identity
than it is in social settings where there are many people of
your gender.
The group’s status is another important social identity
factor because association with the group makes us feel better
about ourselves (i.e., self-enhancement). Medical doctors
usually define themselves by their profession because of
its high status. Some people describe themselves by where
they work (“I work at Shopify”) because their employer has
a good reputation. Others never mention where they work
because their employer is noted for poor relations with
employees or has a poor reputation in the community.31
Everyone tries to balance personal and social identities to
some degree, but the priority for uniqueness (personal identities) versus belongingness (social identities) differs from one
person to the next. People whose self-concepts are heavily
defined by social rather than personal identities are more
motivated to abide by team norms and are more easily influenced by peer pressure. Those who place more emphasis on
personal identities, on the other hand, speak out more frequently against the majority and are less motivated to follow
the team’s wishes. Furthermore, expressing disagreement
with others is a sign of distinctiveness and can help employees
form a clearer self-concept, particularly when that disagreement is based on differences in personal values.32
Self-concept become a hot topic in the social sciences and is starting to bloom in organizational behaviour research.33 This section
briefly noted that self-concept influences human perceptions,
decision making, motivation, stress, team dynamics, leadership
Social Identity Theory Example
Social Identity
Desjardins Group
An Individual’s
Social Identity
Université Laval
Contrasting Groups
Employees at
other firms
of other countries
Graduates of
other schools
Chapter Three
Perceiving Ourselves and Others in Organizations 65
Global Connections 3.2
Starbucks Coffee Company has become a success story
in China by making the American coffee-house chain
an integral part of employees’ social identity. It does
this in several ways. First, employees (who are called
“partners”) easily connect with Starbucks’ core values of
performance, innovation, respect, and belonging.
Second, Starbucks has positioned itself as a premium
brand, which further elevates employee pride. The company
offers competitive pay, comprehensive health insurance, an
employee ownership plan, a housing allowance for full-time
staff, and ongoing training and career development.
Starbucks staff also proudly identify with their
employer because of its well-known emphasis on families—an important value in Chinese culture. The company holds an annual “Partner Family Forum,” where
employees and their parents learn about Starbucks and
its future in China. The chain also recently introduced
special critical-illness insurance for employees’ elderly
parents. “We have always aspired to create a culture
that our employees are proud to belong to,” says an
executive at Starbucks Asia Pacific.
* Starbucks, “Starbucks Strengthens Commitment in China,” news release (Chengdu, China, January 12, 2016); M. Zakkour, “Why Starbucks Succeeded
in China: A Lesson for All Retailers,” Forbes, August 24, 2017; Starbucks, “Starbucks Redefines Partner Benefits in China,” news release (Beijing, China,
April 11, 2017); O. Farry, “Harnessing the Power,” South China Morning Post (Hong Kong), November 17, 2017, 1.
development, and several other OB topics. Consequently, we
will refer to self-concept later in this chapter and in many
other topics throughout this book.
Perceiving the World around Us
We spend considerable time perceiving ourselves, but most
of our perceptual energy is directed toward the outer world.
Whether as a chemical engineer, forensic accountant, or
senior executive, we need to make sense of the world around
us, including the conditions that challenge the accuracy of
those perceptions. Perception is the process of receiving
information about and making sense of our surrounding
environment. It includes determining which information to
notice, how to categorize
this information, and how
perception The process of
to interpret it within the
receiving information about
and making sense of our
framework of our existing
surrounding environment.
The perceptual process
generally follows the steps shown in Exhibit 3.3. Perception
begins when environmental stimuli are received through
our senses. We are continually bombarded by external
stimuli. Most are screened out; the rest are organized and
interpreted. The process of attending to some information
received by our senses and ignoring other information is
called selective attention. Selective attention is influenced
by characteristics of the person or object being perceived,
particularly size, intensity,
selective attention The promotion, repetition, and
cess of attending to some
novelty. For example, a
information received by our
small, flashing red light on
senses and ignoring other
a nurses’ workstation console is immediately noticed
because it is bright (intensity), flashing (motion), a rare
event (novelty), and has symbolic meaning that a patient’s
vital signs are failing. Notice that selective attention is also
influenced by the context in which the target is perceived.
For instance, selective attention is triggered by things or people who are out of context, such as someone with a foreign
accent in a setting where most people have a local accent.
Characteristics of the perceiver also influence selective
attention, usually without the perceiver’s awareness.34 When
information is received through the senses, our brain quickly
and nonconsciously assesses whether it is relevant or irrelevant to us and then attaches emotional markers (worry, happiness, boredom) to the retained information.35 Emotional
Part Two
Individual Behaviour and Processes
Model of the Perceptual Process
Environmental Stimuli
Selective attention and
emotional marker response
Perceptual organization
and interpretation
Attitudes and behaviour
markers play a vital role in storing and retaining information
in memory; those emotions are later reproduced when recalling the information. The selective attention process is far from
perfect, however. The Greek philosopher Plato acknowledged
this imperfection long ago when he wrote that we see reality
only as shadows reflecting against the rough wall of a cave.36
One selective attention bias is the effect of our assumptions and expectations about future events. You are more
likely to notice a particular co-worker’s email among
the daily avalanche of messages when you are expecting to receive that email (even more so if it is important).
Unfortunately, expectations and assumptions also cause us
to screen out potentially important information. In one study,
students were asked to watch a 30-second video clip in which
several people passed around two basketballs. Students in
one group were instructed simply to watch the video clip.
Most of them readily noticed a person dressed in a gorilla
suit walking among the players for nine seconds and stopping to thump his or her chest. Students in a second group
were asked to count the number of times one of the two basketballs was passed around. Only half of the people in this
latter group noticed the intruding gorilla.37
Another selective attention problem, called confirmation
bias, is the nonconscious tendency for people to screen out
information that is contrary
confirmation bias The proto their decisions, beliefs,
cess of screening out inforvalues, and assumptions,
mation that is contrary to our
while more readily acceptvalues and assumptions, and
ing information that conto more readily accept confirms those elements.38
firming information.
When making an important
decision, such as investing in a costly project, we tend to pay
attention to information that supports that decision, ignore
information that questions the wisdom of the decision, and
more easily recall the supportive than the opposing information. Confirmation bias is a well-known perceptual problem
in law enforcement when law enforcement professionals
form a theory too early in an investigation. A recent report
on wrongful convictions by Canadian federal, provincial, and
territorial departments of justice devoted an entire chapter
to this “tunnel vision,” which occurs when prosecutors or
police “focus on a particular theory of a case and . . . dismiss
or undervalue evidence which contradicts that theory.”39
We pay attention to a tiny fraction of the stimuli received by
the senses. Even so, human beings further reduce the huge volume and complexity of the information received through various perceptual grouping strategies. Perceptual grouping occurs
mostly without our awareness, yet it is the foundation for making sense of things and fulfilling our need for cognitive closure.
The most common and far-reaching perceptual grouping
process is categorical thinking—the mostly nonconscious
process of organizing people and objects into preconceived
categories that are stored in our
categorical thinking
long-term memory.40 People
Organizing people and
are usually grouped together
objects into preconceived
based on their observable simcategories that are stored
ilarity, such as gender, age,
in our long-term memory.
race, or clothing style. This
Chapter Three
Perceiving Ourselves and Others in Organizations 67
©Bill Graveland/The Canadian Press
“It is a capital mistake to theorize before you have all the evidence,” warned the mythical detective Sherlock Holmes
in A Study in Scarlet. “It biases the judgment.” Law enforcement agencies try to follow this advice, but many flawed
investigations are caused by confirmation bias. An Alberta judge recently identified this “tunnel vision” in the behaviour
of the lead detective of a re-opened sexual harassment investigation. According to court records, the detective told two
people during an interview that some witnesses were already “on board” and that the “investigation will end with a
positive result.” He also told a colleague that the accused was guilty beyond a reasonable doubt. The detective stated
in court that the accused was “still providing false information” to the community, which he later admitted was how he
interpreted the accused’s claim to others that he was innocent. The court also felt that the detective had withheld, lost,
and failed to recreate evidence that did not support the guilty verdict. The judge stayed (suspended) all charges due to
the detective’s confirmation bias and other errors.*
* The Sherlock Holmes quotation is from A. Conan Doyle, “A Study in Scarlet,” in The Complete Sherlock Holmes (New York: Fine Creative Media, 2003), 3–96.
Sherlock Holmes offers similar advice in “A Scandal in Bohemia,” p . 189. The Alberta case is: R. v. Iskander, 2017 ABPC 191 (CanLII).
categorization process also groups people together by their
proximity to one another. If you notice a group of employees
working in the same area and know that some of them are
marketing staff, you will likely assume that the others in that
group are also marketing staff.
A second perceptual grouping process organizes incoming information by filling in the missing pieces of the puzzle.
Everyone wants to make sense of what goes on around them,
so they make assumptions about missing information by relying
on past images and experiences in those situations. For instance,
people engage in this cognitive closure by assuming what happened at a meeting that they didn’t attend (e.g., who was there,
where it was held). A related process is one in which people
tend to see patterns that, in fact, are random events. For example,
people incorrectly believe that a sports player or gambler with a
string of wins is more likely to win next time as well.41
The process of “making sense” of the external environment involves interpreting incoming information, not just
organizing it. This happens as quickly as selecting and organizing because the previously mentioned emotional markers
are tagged to incoming stimuli; these markers are essentially
quick judgments about whether that information is good or
bad for us. How much time does it take to make these quick
judgments? Recent studies estimate that we make reliable
judgments about another individual’s trustworthiness based
on viewing a facial image for as little as 50 milliseconds
(one-twentieth of a second). In fact, our opinion regarding
whether we like or trust a person is about the same whether
How much perceptual structure do you need? You can discover your need for perceptual structure
by locating this self-assessment in Connect.
Part Two
Individual Behaviour and Processes
we see the person’s face for a minute or a fraction of a second.42 Collectively, these studies reveal that selective attention, perceptual organization, and interpretation operate very
quickly and to a large extent without our awareness.
Mental Models
To achieve our goals with some degree of predictability and
sanity, we need road maps of the environments in which we
live. These road maps, called mental models, are knowledge
structures that we develop to
mental models Knowledge
describe, explain, and predict
structures that we develop
the world around us.43 They
to describe, explain, and
consist of visual or relational
predict the world around us.
images in our mind, such as
what the classroom looks like or what happens when we submit an assignment late. Mental models partly rely on the process of perceptual grouping because they fill in the missing
pieces, including the causal connection among events. For
example, you have a mental model about attending a class lecture or seminar, including assumptions or expectations about
where the instructor and students arrange themselves in the
room, how they ask and answer questions, and so forth. In
other words, you create a mental image of a class in progress.
Mental models are important for sense making, yet they also
make it difficult to see the world in different ways. For example,
accounting professionals tend to see corporate problems from
an accounting perspective, whereas marketing professionals
see the same problems from a marketing perspective. Mental
models also block our recognition of new opportunities.
How do we change mental models? That’s a tough challenge. After all, we develop these knowledge structures from
several years of experience and reinforcement. The most
important strategy is to be aware of and frequently question our mental models. We also need to be more aware of
our assumptions, which are often based on mental models.
Working with people from diverse backgrounds is another
way to break out of existing mental models. Colleagues from
different cultures and areas of expertise tend to have different mental models, so working with them makes our own
assumptions more obvious.
Specific Perceptual Processes
and Problems
Within the general perceptual process are specific subprocesses and associated perceptual errors. In this section of
the chapter, we discuss several of these perceptual processes
and biases as well as their implications for organizational
behaviour, beginning with the most widely known one:
Stereotyping is the perceptual process in which we assign
characteristics to an identifiable group and then automatically transfer those features to anyone we believe is a
member of that group.44 The
assigned characteristics tend
stereotyping The process
of assigning traits to people
to be difficult to observe, such
based on their membership
as personality traits and abiliin a social category.
ties, but they can also include
physical characteristics and a
host of other qualities. If we learn that someone is a professor, for example, we implicitly assume the person is probably
also intelligent, absent-minded, and socially challenged.
Stereotypes are formed to some extent from personal experience, but they are mainly provided to us through media
images (e.g., movie characters) and other cultural prototypes.
Consequently, stereotypes are shared beliefs across an entire
society and often across several cultures, rather than beliefs
that differ from one person to the next. Most stereotypes have a
few kernels of truth; they are more likely to characterize people
within the group than the rest of us.45 Still, as the opening case
study to this chapter pointed out, stereotypes embellish or distort
the kernels of truth and include other features that are not representative of people in that group. In spite of their inaccuracy,
stereotypes about engineers, for example, remain persistent
enough to discourage many women from pursuing this profession.
Why People Stereotype
People engage in stereotyping because, as a form of categorical thinking, it is usually a nonconscious “energy-saving”
process that simplifies our understanding of the world. It
is easier to remember features of a stereotype than the constellation of characteristics unique to each person we meet.
A second reason is that we have an innate need to understand
and anticipate how others will behave. We don’t have much
information about people initially or when we seldom interact with them, so we rely on stereotypes to fill in the missing
pieces. The higher the perceiver’s need for cognitive closure,
the higher their reliance on stereotypes.46
A third explanation for stereotyping is that it is motivated by the observer’s own need for social identity and
self-enhancement. Earlier in this chapter we explained that
people define themselves by the groups to which they belong
or have an emotional attachment. They are also motivated to
maintain a positive self-concept. This combination of social
identity and self-enhancement leads to the process of categorization, homogenization, and differentiation, all of which
are the foundations of stereotyping:47
• Categorization. Social identity is a comparative process,
and the comparison begins by categorizing people into
Chapter Three
Perceiving Ourselves and Others in Organizations 69
Global Connections 3.3
South African restaurant chain Nando’s recently
launched a witty advertisement that pokes fun at our
tendency to stereotype people who are different from
us. The “You People” video has several brief scenes
where viewers easily misperceive the actors’ role in
the scene (upscale customer versus employee) or the
meaning of their actions (running for exercise versus
running away from police). It also shows that those
who stereotype “you people” fail to recognize similar
behaviour in themselves.
“‘You people’ is a phrase often used by South
Africans when describing people who are different to
them,” says Doug Place, Nando’s chief marketing officer
in Johannesburg. “It’s a phrase that goes hand in hand
with an unconscious bias.”
Place explains that Nando’s created the ad to
encourage discussion about stereotyping and to promote
©Aaron Amat/Shutterstock
greater harmony in society. “If you’re watching our ad
and say ‘I’ve done that’ (hopefully with a guilty smile),
then we’ve been successful at starting a crucial conversation—hopefully one that starts with ‘us people’.”
* J. Richardson, “Nando’s Takes on Stereotypes with Their Hilarious New Ad: #YouPeople [Video],” The South African, November 26, 2018; J. Tennant,
“#NewCampaign: All You People, This Ad’s for You,” Advertising News, November 26, 2018.
distinct groups. By viewing someone (including yourself)
as a Nova Scotian, for example, you remove that person’s
individuality and, instead, see them as a prototypical representative of the group called Nova Scotians. This categorization then allows you to distinguish Nova Scotians
from people who live in, say, Ontario or Alberta.
• Homogenization. To simplify the comparison process,
we tend to think that people within each group are very
similar to one another. For instance, we think Nova
Scotians collectively have similar attitudes and characteristics, whereas Ontarians collectively have their own set
of characteristics. Of course, every individual is unique,
but we often lose sight of this fact when thinking about
our social identity and how we compare to people in
other social groups.
• Differentiation. Along with categorizing and homogenizing people, we tend to assign more favourable characteristics to people in our social identity groups than to
people in other groups.48 This differentiation is motivated
by self-enhancement because being in a “better” group
produces higher self-esteem. Differentiation is often subtle, but it can escalate into a “good guy versus bad guy”
contrast when groups engage in overt conflict with each
other. In other words, when out-group members threaten
our self-concept, we are particularly motivated (often
without our awareness) to assign negative stereotypes
to them. Some research suggests that men have stronger
differentiation biases than do women, but we all differentiate to some extent.
Problems with Stereotyping
Everyone engages in stereotyping, but this process leads to
perceptual biases as well as flawed decisions and behaviours
in the workplace. One problem with stereotypes is that they
are inaccurate. A stereotype does not describe everyone
because members of the stereotyped group are not identical. Furthermore, although a stereotype typically has kernels
of truth, most characteristics are distorted and embellished
to such an extent that they describe very few people in the
group. The traditional accountant stereotype (boring, cautious, calculating) perhaps describes a few accountants, but
it is certainly not characteristic of all, or even most, people
in this profession. Nevertheless, once we categorize someone
as an accountant, the nonobservable stereotypical features of
accountants are transferred to that individual, even though we
have no evidence that they actually have those characteristics.
A second problem with stereotypes is that they produce
stereotype threat. This is a
stereotype threat An
condition whereby members
individual’s concern about
of a group are so concerned
confirming a negative steabout the negative stereotype
reotype about their group.
assigned to their group that
Part Two
Individual Behaviour and Processes
they end up displaying the stereotype trait they are trying to
avoid.49 Stereotype threat occurs because people anxiously
try to avoid confirming the undesirable stereotype traits of
their group and try to push the negative image from their
mind. These two cognitive activities divert energy and attention, which makes it more difficult to perform the task well.
The negative stereotype also can weaken self-efficacy; it is
difficult to be confident in your ability when your group’s
stereotype suggests otherwise.
For example, women perform worse on math and science
tests when sensitized to the generally false but widely held
belief that women underperform men in these subjects. They
also tend to have lower scores when there are few women in
the group being tested. Women achieve much higher scores
when the gender stereotype is not salient, such as when taking the test with many women in the class. Almost anyone
can be affected by stereotype threat, but studies have particularly observed it for women, some minority groups, and
older people.
A third problem with stereotyping is that it lays the foundation for unfair discrimination. Most of this perceptual bias
occurs as unintentional (systemic) discrimination, whereby
decision makers rely on stereotypes to establish notions of
the “ideal” person in specific roles. Those who don’t fit the
ideal tend to receive a less favourable evaluation than someone who is compatible with the occupational stereotype.
Unintentional systemic discrimination also affects
employment opportunities and salaries. For example, science
faculty from several research intensive universities were
given the application materials of either a (fictitious) male or
female undergraduate student who was purportedly applying
for a science laboratory manager job. The applications were
identical other than the name and gender of the applicant,
yet the male applicant received significantly higher ratings
than the female applicant on competence and hireability.
The male applicant also received a 15 percent higher recommended salary than did the female applicant. Female faculty
exhibited as much gender bias as the male faculty.50
©Jacob Lund/Shutterstock
Women represent about 45 percent of the Canadian workforce and almost one-third of middle managers. Yet just a decade
ago (2010) they comprised only 12 percent of board members on Canadian publicly-traded (TSX) companies. Fortunately,
widespread attention and government initiatives have pushed against systemic discrimination. Women now represent
30 percent of board members of TSX companies. The percentages of women on corporate boards are highest in France
(44 percent), Norway (41 percent), Belgium (36 percent), and Sweden (35 percent). The lowest female representation on
corporate boards occurs in South Korea (3 percent), the Middle East (less than 5 percent), and Japan (6 percent).*
* M. Ellis and M.T. Eastman, “Women on Boards: Progress Report 2018” (New York: MSCI, December 2018); R. Kersley et al., “The CS Gender 3000 in 2019:
The Changing Face of Companies” (Zurich: Credit Suisse Research Institute, October 10, 2019). Data on female workforce and middle management representation
in Canada are summarized at: Catalyst, “Statistical Overview of Women in the Workforce: Canada,” Knowledge Center (New York: Catalyst, 6 April 2016),
http://www.catalyst.org/knowledge/statistical-overview-women-workforce (accessed 10 January 2017).
Chapter Three
Worse than systemic discrimination is intentional discrimination or prejudice, in which people hold unfounded
negative attitudes toward people belonging to a particular
stereotyped group.51 Intentional discrimination deliberately
puts the target person at an unfair disadvantage, which is
unfortunately still common in organizations. One recent
meta-analysis estimated that minority applicants in OECD
countries need to submit almost 50 percent more job applications to receive the same number of interviews as majority applicants. For instance, some French firms have used
the code BBR as a signal that they want recruiters to hire
someone who is Caucasian. “Some people asked for what
in French is called a BBR; it’s a code to say a ‘Bleu-BlancRouge’—the colours of our national flag,” explains one
French recruiter. “It was to tell the recruitment agency I am a
racist company but I do not want it to appear as such so I use
an external supplier to bypass the law.”52
If stereotyping is such a problem, shouldn’t we try to
avoid this process altogether? Unfortunately, it’s not that
simple. Most experts agree that categorical thinking (including stereotyping) is an automatic and nonconscious process.
Specialized training programs can minimize stereotype activation to some extent, but for the most part the process is
hardwired in our brain cells.53 Also remember that stereotyping helps us in several valuable (although fallible) ways
described earlier: minimizing mental effort, filling in missing information, and supporting our social identity.
The good news is that while it is very difficult to prevent
the activation of stereotypes, we can minimize the application of stereotypic information. In other words, although we
automatically categorize people and assign stereotypic traits to
them, we can consciously minimize the extent that we rely on
that stereotypic information.54 Later in this chapter, we identify
ways to minimize stereotyping and other perceptual biases.
Another widely discussed perceptual phenomenon in organizational settings is the attribution process.55 Attribution
involves forming beliefs about the causes of behaviour
or events. Generally, we perceive whether an observed
behaviour or event is caused mainly by characteristics of
the person (internal factors)
attribution process The
or by the environment (exterperceptual process of
nal factors). Internal factors
deciding whether an
include the person’s ability
observed behaviour or
or motivation, whereas exterevent is caused largely by
internal or external factors.
nal factors include resources,
co-worker support, or luck.
If someone doesn’t show up for an important meeting, for
instance, we infer either internal attributions (the co-worker
is forgetful, lacks motivation, etc.) or external attributions
Perceiving Ourselves and Others in Organizations 71
(traffic, a family emergency, etc.) to make sense of the person’s absence.
People rely on the three attribution rules—consistency,
distinctiveness, and consensus—to decide whether another
individual’s behaviour and performance are caused mainly
by personal characteristics or by situational influences (see
Exhibit 3.4).56 To help explain how these three attribution
rules operate, imagine a situation in which an employee is
making poor-quality products on a particular machine. We
would probably conclude that the employee lacks skill or
motivation (an internal attribution) if the employee consistently makes poor-quality products on this machine (high
consistency), the employee makes poor-quality products on
other machines (low distinctiveness), and other employees
make good-quality products on this machine (low consensus).
In contrast, we would believe something is wrong with the
machine (an external attribution) if the employee consistently
makes poor-quality products on this machine (high consistency), the employee makes good-quality products on other
machines (high distinctiveness), and other employees make
poor-quality products on this machine (high consensus).
Notice that consistency is high for both internal and external attributions. This occurs because low consistency (the
person’s output quality on this machine is sometimes good
and sometimes poor) weakens our confidence about whether
the source of the problem is the person or the machine.
In other words, distinctiveness and consensus determine
whether the attribution should be internal or external,
whereas consistency determines how confident we should be
in that attribution.
The attribution process is important because understanding cause–effect relationships enables us to work effectively
with others and to assign praise or blame to them.57 Suppose
a co-worker didn’t complete their task on a team project. You
would approach this situation differently if you believed the
co-worker was lazy or lacked sufficient skill (an internal
attribution) than if you believed the poor performance was
due to lack of time or resources available to the co-worker
(an external attribution). We also react differently to attributions of our own behaviour and performance. Students
who make internal attributions about their poor grades, for
instance, are more likely to drop out of their programs than if
they make external attributions about those grades.58
Attribution Errors
The attribution process is susceptible to errors. One such error
is self-serving bias—the tenself-serving bias The
dency to attribute our failures
tendency to attribute our
to external causes more than
favourable outcomes to
internal causes, while sucinternal factors and our
cesses are due more to internal
failures to external factors.
than external factors.59 Simply
Part Two
Individual Behaviour and Processes
Attribution Theory Rules
Internal Attribution
Behaviour is attributed
to personal factors
(high consistency)
(low distinctiveness)
(low consensus)
Did this person act
this way in this
situation in the past?
Does this person act
this way in other
Do other people
act this way
in this situation?
(high consistency)
(high distinctiveness)
(high consensus)
External Attribution
Behaviour is attributed
to situational factors
put, we take credit for our successes and blame others or the
situation for our mistakes. In annual reports, for example,
executives mainly refer to their personal qualities as reasons
for the company’s successes and to external factors (competitors, economic problems, skill shortages) as reasons for
the company’s failures.60 Self-serving bias occurs mainly
because of the self-enhancement process described earlier in
this chapter. By pointing to external causes of their own failures and internal causes of their successes, people generate a
more positive self-concept.
Another widely studied attribution error, fundamental
attribution error (also called correspondence bias), is the
tendency to overemphasize internal causes of another person’s behaviour and to discount or ignore external causes of
their behaviour.61 We are more likely to attribute a co-worker’s late arrival for work to
fundamental attribution
lack of motivation rather than
error The tendency to see
to situational constraints (such
the person rather than the
as traffic congestion). This
situation as the main cause
phenomenon occurs because
of that person’s behaviour.
observers can’t easily see the
external factors that constrain another person’s behaviour.
Also, people like to think that human beings (not the situation) are the prime causes of their behaviour, so internal
attributions receive preference in ambiguous situations.
However, fundamental attribution error might not be as
common or severe as was previously thought, particularly in
cultures that emphasize the context of behaviour and where
co-workers have high mutual understanding of each other’s
work environment.62
Self-fulfilling prophecy occurs when our expectations about
another person cause that individual to act in a way that is
consistent with those expectations. In other words, our perself-fulfilling prophecy The
perceptual process in which
ceptions can influence reality.
our expectations about
Exhibit 3.5 illustrates the
another person cause that
four steps in the self-fulfillperson to act more consising prophecy process using
tently with those expectations.
the example of a supervisor
Chapter Three
Perceiving Ourselves and Others in Organizations 73
The Self-Fulfilling Prophecy Cycle
1. Supervisor forms
expectations about the
2. Supervisor’s
expectations affect
their behaviour
toward the employee
4. Employee’s behaviour
becomes more consistent
with the supervisor’s initial
3. Supervisor’s behaviour
affects the employee’s ability and
motivation (self-confidence)
and a subordinate.63 First, the supervisor forms expectations
about the employee’s future behaviour and performance.
These expectations are sometimes inaccurate because
first impressions are usually formed from limited information. Second, the supervisor’s expectations influence their
behaviour toward employees. In particular, high-expectancy
employees (those expected to do well) receive more emotional
support through nonverbal cues (e.g., more smiling and eye
contact from the boss), more frequent and valuable feedback
and reinforcement, more challenging goals, better training,
and more opportunities to demonstrate good performance.64
The third step in self-fulfilling prophecy includes two
effects of the supervisor’s behaviour on the employee.
One effect is that a high-expectancy employee learns more
skills and knowledge than does a low-expectancy employee
because of better training and more practice opportunities. The other effect is that the high-expectancy employee
becomes more self-confident, which results in stronger motivation and willingness to set challenging goals.65 In the final
step, high-expectancy employees have higher motivation and
better skills, resulting in better performance, while the opposite is true of low-expectancy employees.
Self-fulfilling prophecy has been observed in many
contexts. In one study, four Israeli Defence Force combat
command course instructors were told that one-third of the
incoming trainees had high command potential, one-third
had normal potential, and the rest had unknown potential.
The trainees had been randomly placed into these categories
by the researchers, but the instructors were led to believe
that the information they received was accurate. Consistent
with self-fulfilling prophecy, the high-expectancy soldiers
performed significantly better by the end of the course than
did the trainees in the other groups. They also had more
favourable attitudes toward the course and the instructor’s
leadership effectiveness. An analysis of dozens of leader
intervention studies over the years found that self-fulfilling
prophecy is one of the most powerful leadership effects on
follower behaviour and performance.66
Contingencies of Self-Fulfilling Prophecy
Self-fulfilling prophecy has a stronger effect at the beginning
of a relationship, such as when employees are first hired. It is
also stronger when several people (rather than just one person) hold the same expectations of the individual. In other
words, we might be able to ignore one person’s doubts about
our potential but not the collective doubts of several people.
The self-fulfilling prophecy effect is also stronger among
people with a history of low achievement. These people tend
to have lower self-esteem, so they are more easily influenced
by others’ opinions of them.67
The main lesson from
the self-fulfilling prophecy
positive organizational
behaviour A perspective of
literature is that leaders
organizational behaviour that
need to develop and mainfocuses on building positive
tain a positive, yet realqualities and traits within
istic, expectation toward
individuals or institutions as
all employees. This recopposed to focusing on what
ommendation is consistent
is wrong with them.
with the emerging philosophy of positive organizational behaviour, which suggests
that focusing on the positive rather than negative aspects
of life will improve organizational success and individual
Part Two
Individual Behaviour and Processes
well-being. Communicating realistic hope and optimism is
so important that a recent Canadian study as well as earlier international research identified it as one of the critical success factors for physicians and surgeons. Training
programs that make leaders aware of the power of positive expectations seem to have minimal effect, however.
Instead, generating positive expectations and hope depend
on a corporate culture of support and learning. Hiring
supervisors who are inherently optimistic toward their
staff is another way of increasing the incidence of positive
self-fulfilling prophecies.68
Self-fulfilling prophecy, attribution, and stereotyping are
among the most common perceptual processes and biases in
organizational settings, but there are many others. Four additional biases that have received attention in organizational
settings are briefly described below.
Halo Effect
The halo effect occurs when our general impression of a
person, usually based on one prominent characteristic, distorts our perception of other characteristics of that person.69
If a supervisor who values
punctuality notices that
halo effect A perceptual
an employee is sometimes
error whereby our general
impression of a person, usulate for work, the superally based on one prominent
visor might form a negacharacteristic, colours our
tive overall opinion of the
perception of other characteremployee and evaluate that
istics of that person.
person’s other performance
dimensions unfavourably
as well. The halo effect is most likely to occur when important information about the perceived target is missing or we
are not sufficiently motivated to search for it. Instead, we use
our general impression of the person to fill in the missing
False-Consensus Effect
The false-consensus effect (also called similar-to-me effect)
occurs when people overestimate the extent to which others have similar beliefs or
behaviours to their own.70
false-consensus effect A perEmployees who are thinkceptual error in which we overing of quitting their jobs
estimate the extent to which
others have beliefs and charoverestimate the percentacteristics similar to our own.
age of their co-workers
who are also thinking about
quitting, for example. The false-consensus effect occurs
partly because we are comforted by the belief that others are
similar to us, particularly regarding less acceptable or divisive behaviour. A second explanation is that we interact more
with people who have similar views and behaviours. This
frequent interaction causes us to overestimate how common
those views and behaviours are in the entire organization or
A third explanation for false-consensus effect is confirmation bias. We are more likely to remember information
that is consistent with our own views and selectively screen
out information that is contrary to our beliefs. A fourth
explanation is that our social identity process homogenizes
people within groups, so we tend to think that everyone in
that group has similar opinions and behaviour, including the
false-consensus attitude or behaviour.
Recency Effect
The recency effect occurs when the most recent information dominates our
recency effect A perceptual
perceptions.71 This perceperror in which the most recent
tual bias is most common
information dominates our
when people (especially
perception of others.
those with limited experience) make a decision
involving complex information. For instance, auditors digest
large volumes of information in forming a judgment about
financial documents. They are susceptible to recency effect
because the most recent information received prior to rendering their decision may receive more weight than information received at the beginning of the audit. Similarly,
when supervisors evaluate the performance of employees
over the previous year, the most recent performance information dominates the evaluation because it is the most easily recalled.
Primacy Effect
The primacy effect is our tendency to rely on the first information we receive about
primacy effect A perceptual
people to quickly form an
error in which we quickly form
opinion of them.72 It is the
an opinion of people based
notion that first impressions
on the first information we
are lasting impressions.
receive about them.
This rapid perceptual organization and interpretation
occurs because we need to make sense of the situation and,
in particular, to trust others. The problem is that first impressions—particularly negative first impressions—are difficult to
change. After categorizing someone, we tend to select subsequent information that supports our first impression and
screen out information that opposes that impression. A faulty
first impression can be corrected more easily within a very
short time after it is formed.
Chapter Three
Perceiving Ourselves and Others in Organizations 75
First Impressions Count for Job Applicants*
of 1,014 employers say they would not hire an
applicant who sends text messages or uses their phone
during the job interview.
of 1,138 employers say they
instantly reject resumé with typos or
bad grammar.
of 1,138 employers
say they spend less than 30
seconds looking at a resumé.
of 1,014 employers say they
would not hire an applicant who
talks negatively during the job
interview about current or
previous employers.
of 2,076 employers say
they automatically dismiss a job
applicant whose resumé includes a
large amount of wording from the
job posting.
*“Careerbuilder Releases Study of Common and Not-So-Common Resume Mistakes That Can Cost You the Job,” News Release (Chicago: Careerbuilder, September 11,
2013); “The Most Unusual Interview Mistakes and Biggest Body Language Mishaps, According to Annual CareerBuilder Survey,” News Release (Chicago and
Atlanta: CareerBuilder, February 22, 2018); “Employers Share Their Most Outrageous Resume Mistakes and Instant Deal Breakers in a New CareerBuilder Study,”
News Release (Chicago and Atlanta: CareerBuilder, August 24, 2018).
Improving Perceptions
We can’t bypass the perceptual process, but we should try
to minimize perceptual biases and distortions. Three potentially effective ways to improve perceptions include awareness of perceptual biases, self-awareness, and meaningful
One of the most obvious and widely practised ways to reduce
perceptual biases is by knowing that they exist. For example,
diversity awareness training tries to minimize discrimination
by making people aware of systemic discrimination as well
as prejudices that occur through stereotyping. This training
also attempts to dispel myths about people from various
cultural and demographic groups. Awareness of perceptual
biases can reduce these biases to some extent by making
people more mindful of their thoughts and actions. However,
awareness training has only a limited effect.73 One problem
is that teaching people to reject incorrect stereotypes has the
unintended effect of reinforcing rather than reducing reliance on those stereotypes. Another problem is that diversity
training is ineffective for people with deeply held prejudices
against those groups.
A more successful way to minimize perceptual biases is
by increasing self-awareness.74 By discovering our own
perceptual biases, we begin to reduce those biases through
increased open-mindedness toward others. Self-awareness is
also the first step to take in becoming an authentic leader
(see Chapter 12). Essentially, leaders need to understand
their own values, strengths, and biases as a foundation for
building a vision and leading others toward that vision.75
But how do we become more self-aware? One approach
is to complete formal tests that indicate any implicit biases
we might have toward others. One such instrument is the
Implicit Association Test (IAT), which attempts to detect
subtle racial, age, gender, disability, and other forms of bias
by associating positive and negative words with specific
groups of people.76 Although the reliability and accuracy
Part Two
Individual Behaviour and Processes
Diversity training programs are well-entrenched bastions
in the battle against workplace discrimination. In most
programs, participants are reminded to respect cultural
and gender differences. They also learn about common
assumptions and biases that people make about other
demographic groups. When companies lose discrimination
cases, one of their first requirements is to introduce diversity training to remedy the problem.
Despite its good intentions, diversity training might not be
as useful as one would hope. One concern is that most sessions are mandatory, so employees aren’t really committed
to their content. Biases and prejudices are deeply anchored,
so a half-day lecture and group chat on diversity likely won’t
change employee perceptions and behaviour. Even if they
motivate employees to be more tolerant of others and to avoid
stereotypes, the good intentions of these programs evaporate quickly in organizations that lack an inclusive culture.
Perversely, the mere presence of diversity training
may undermine its beneficial objectives. There is some
evidence that discussing demographic and cultural differences increases rather than decreases stereotyping.
Students in one study showed more bias against elderly
people after watching a video encouraging them to be less
biased against older people! Participants at some diversity
training programs felt defensive and stressed because the
diversity session made them feel unfairly prejudiced or the
focus of unwanted attention.
Studies also report that diversity awareness programs
create an illusion of fairness. Disadvantaged employees in
companies with these programs are more likely to believe
their employer doesn’t engage in unfair discrimination.
However, this perception of fairness makes employees
less aware of incidents where the company does engage
in unfair discrimination.
* J. Watson, “When Diversity Training Goes Awry,” Black Issues in Higher Education, January 24, 2008, 11; E.L. Paluck and D.P. Green, “Prejudice Reduction:
What Works? A Review and Assessment of Research and Practice,” Annual Review of Psychology 60, no. 1 (2009): 339–67; M.M. Duguid and M.C. Thomas-Hunt,
“Condoning Stereotyping? How Awareness of Stereotyping Prevalence Impacts Expression of Stereotypes,” Journal of Applied Psychology 100, no. 2 (2015):
343–59; L.M. Brady et al., “It’s Fair for Us: Diversity Structures Cause Women to Legitimize Discrimination,” Journal of Experimental Social Psychology 57 (2015):
100–10; F. Dobbin and A. Kalev, “Why Diversity Programs Fail,” Harvard Business Review 94, no. 7/8 (2016): 52–60; J. Jargon and R. Feintzeig, “Starbucks Racial
Bias Training ‘Uncomfortable’ and ‘Enlightening’: Employees React,” Wall Street Journal, May 31, 2018.
of the IAT is still being debated by scholars, the test does
seem to provide some evidence of specific biases. Manulife
Financial, Canadian Broadcasting Corporation, Accenture
Canada, the City of Edmonton, and many other organizations have introduced the IAT or similar tests to help managers and other employees discover their implicit biases.77
Another way to reduce perceptual biases through increased
self-awareness is by applying the Johari Window.78
Developed by psychologists Joseph Luft and Harry Ingram
(hence the name “Johari”), this model of self-awareness and
mutual understanding divides information about you into
four “windows”—open, blind, hidden, and unknown—based
on whether your own values, beliefs, and experiences are
known to you and to others (see Exhibit 3.6). The open area
includes information about you that is known both to you and
to others. The blind area
refers to information that is
Johari Window A model of
known to others but not to
self-awareness and mutual
understanding with others
you. For example, your colthat advocates disclosure and
leagues might notice that
feedback to increase our open
you are self-conscious and
area and reduce the blind, hidawkward when meeting the
den, and unknown areas.
company chief executive,
but you are unaware of this fact. Information known to you
but unknown to others is found in the hidden area. Finally,
the unknown area includes your values, beliefs, talents, and
behaviours that aren’t known to you or others.
The main objective of the Johari Window is to increase
the size of the open area so that both you and your colleagues
are more aware of your underlying beliefs, values, and perceptual biases. This is partly accomplished by reducing the
hidden area through disclosure—informing others of your
personal characteristics that may influence the work relationship. The open area also increases through feedback from
others about your behaviour. Feedback reduces your blind
area because, according to recent studies, people near you
are good sources of information about many (but not all)
of your traits and behaviours.79 Finally, the combination of
disclosure and feedback occasionally produces revelations
about you in the unknown area.
The Johari Window and Implicit Association Test improve
self-awareness, which potentially minimizes biases by making us more open-minded and nonjudgmental. However,
two problems may limit these benefits. First, implicit biases
are similar to stereotypes—they are automatically activated
and, consequently, difficult to prevent. However, as with
Chapter Three
Perceiving Ourselves and Others in Organizations 77
©Robert Kneschke/Shutterstock
Manulife strives to be an inclusive workplace in which everyone can bring their authentic and whole self to work. To
achieve this, the Canadian financial services company’s entire global senior executive group and more than 26,000 of
its managers and employees have completed a nonconscious bias training program. The program gives each participant
confidential feedback on their personal biases (through the IAT or similar test) and provides guidance on how to manage
those perceptions and attitudes. “There needs to be a focus on inclusion, and unconscious bias training is one way that
we’re working to shift our culture,” explains Sandeep Tatla, Manulife’s Global Head of Diversity & Inclusion.*
*S. Tatla, “A Great Start to 2019 - Manulife Named to Bloomberg’s 2019 Gender-Equality Index,” LinkedIn, Pulse (blog), January 16, 2019, https://www.linkedin.com/pulse/great-start-2019-manulife-named-bloombergs-index-sandeep-tatla; “2018 Sustainability Report” (Toronto: Manulife Financial Corporation,
June 4, 2019).
Johari Window Model of Self-Awareness and Mutual Understanding
Feedback from others
Disclosure to others
Known to
Unknown to
Known to
Unknown to
Part Two
Individual Behaviour and Processes
stereotypes, even though implicit biases are still activated,
we can potentially minimize the application of those biases
in our decisions and behaviour.
The second problem is that perceptual bias self-awareness
can cause people to become more sensitized and selfconscious when interacting with people who are the target
of that bias. In one Canadian study, one group of White
(Caucasian) participants completed an IAT that examined
their implicit bias against Indigenous Canadians, whereas
a second group of White participants did not take the IAT.
All White participants were then paired with Indigenous
peers, and for 15 minutes they discussed career goals, academic experiences, or other assigned topics. Everyone then
confidentially completed an evaluation of their discussion
partner. The study found that the White participants who
completed the IAT were more cautious and demonstrated
less positive regard toward their Indigenous discussion
partners than were the White participants who did not complete the IAT. In other words, increased self-awareness of
implicit bias can lead to less favourable interaction with the
targets of that bias.80
Meaningful interaction is any activity in which people
engage in valued (meaningful, not trivial) activities.81 This
process is founded on the contact hypothesis, which states
that, under specific conditions, people who interact with
each other will be less perceptually biased because they
have a more personal understanding of the other person and
their group.82 Meaningful
occurs when
contact hypothesis A theory
executives work beside
stating that the more we interact with someone, the less prejfront-line staff or when any
udiced or perceptually biased
employee performs tasks
we will be against that person.
with co-workers from other
parts of the organization. It
is strongest when people work closely and frequently with
each other on a shared goal that requires mutual cooperation
and reliance. Furthermore, everyone should have equal status
in that context, should be engaged in a meaningful task, and
should have positive experiences with each other in those
Meaningful interaction occurred as a well-timed coincidence several years ago, when executives at Mercer
Peace River Pulp Ltd. in Alberta were working through
difficult discussions with environmentalists. During those
meetings, the river threatened to flood, so everyone got
involved sandbagging the dyke. One Peace River Pulp
executive vividly recalls the occasion because he was
sandbagging alongside one of the most active environmental critics. “We both looked at one another and I think we
both realized we had more in common than we may have
thought,” he says.83
Meaningful interaction reduces dependence on stereotypes because it diminishes psychological distance, improves
our knowledge about individuals, and helps us to observe
their unique attributes in action.84 Meaningful interaction
also potentially improves empathy toward others. Empathy
refers to understanding
and being sensitive to the
empathy A person’s understanding of and sensitivity to
feelings, thoughts, and sit85
the feelings, thoughts, and
uations of others. People
situations of others.
empathize when they visualize themselves in the
other person’s place as if they are the other person. This
perceptual experience is cognitive, emotional, and experiential. In other words, empathy occurs when we understand the
other person’s situation, feel their emotions in that context,
and to some degree react to those thoughts and feelings as
the other person does.
Empathizing reduces attribution errors by improving our
sensitivity to the external causes of another person’s performance and behaviour. A supervisor who imagines what
it’s like to be a single mother, for example, would become
more sensitive to the external causes of lateness and other
events among such employees. However, trying to empathize
with others without spending time with them might actually
increase rather than reduce stereotyping and other perceptual
How strong is your perspective taking? You can discover your level of perspective taking (cognitive
empathy) by completing this self-assessment in Connect.
How strong is your emotional empathy? You can discover your level of emotional empathy by
completing this self-assessment in Connect.
Chapter Three
Global Mindset: Developing
Perceptions across Borders
Shiseido is changing the way it views itself as a global organization. “It’s no longer about Japan and the rest of the world,”
explains Shiseido executive Roselin Lee. The Japanese personal care company has acquired Western brands and decentralized decisions to regional headquarters beyond Japan.
Most of all, Shiseido is training employees so they are ready
for this globalized future. “The structure of the program ties
back closely to the attributes and behaviours that we want our
future-ready leaders to have—agile, inclusive, digitally savvy,
innovative, and most importantly, have a global mindset,” says
Lee, who is Shiseido’s Singapore-based HR executive in the
Asia Pacific region.87
Global mindset refers to an individual’s ability to perceive, know about, and process information across cultures.
It includes the following four specific elements.88
Perceiving Ourselves and Others in Organizations 79
• Adopting a global
global mindset An indiperspective. A global
vidual’s ability to perceive,
mindset increases as
appreciate, and empathize
the individual acquires
with people from other cultures, and to process complex
more of a global than
cross-cultural information.
a local/parochial frame
of reference about their
business and its environment. This frame of reference
includes accumulating knowledge and appreciation of
many cultures without judging the competence of others
by their national or ethnic origins.
• Empathizing and acting effectively across cultures.
A global mindset includes understanding the perceptions and emotions of co-workers from other cultures
in various situations. Furthermore, this empathy translates into effective use of words and behaviours that are
compatible with the local culture.
• Processing complex information about novel environments. People who work across cultures are frequently
Global Connections 3.4
Cathy Ng usually works in EY’s (formerly Ernst & Young’s)
offices in Hong Kong, but she jumped at the offer of a
temporary transfer to London. “My secondment to EY
London has allowed me to develop a global mindset by
working with individuals from different backgrounds and
cultures. It is interesting to know that there are different
ways of looking at the same thing and therefore bringing different insights and ways of improving our work.”
Jessica Lönnqvist, an EY transactions diligence
manager from Helsinki, Finland, also benefited from
her temporary transfer to EY’s offices in Milan, Italy.
“My three-month secondment in Milan with EY was an
invaluable experience. It exposed me to new, bigger
clients and stretched my technical knowledge,” says
Lönnqvist. She particularly noted how working with
people from around the world improves a person’s perceptions and abilities. “The global mindset of EY people
is really inspiring. The open, international, and collaborative environment is so valuable.”
Along with developing a global mindset in its
employees, EY actively looks for this competency in job
©Willy Barton/Shutterstock
applicants. “We need candidates who can work effectively in teams, analyze, innovate and think with a global
mindset, regardless of their domain expertise or background,” says Larry Nash, EY’s director of recruiting for
North, Central, and South America.
* “The EY Global Mindset: Cathy Ng,” EY-Financial Services, FSCareers:Top Stories, accessed March 9, 2019, https://www.fscareers.ey.com/top-stories/
apac_cathy-ng/; J. Lönnqvist, “EY - Jessica Lönnqvist,” EY Global-Careers- Inspiring Women, My Journey (blog), 2018, https://www.ey.com/gl/en/careers/
ey-jessica-lonnqvist; S. McCabe, “EY Eyes over 15,000 New Hires in 2019,” Accounting Today, October 10, 2018; C. Ng. “How has working in EY help to
expand your understanding of the different cultures globally?” 2019.
Part Two
Individual Behaviour and Processes
placed in new situations that require quick understanding
and decision making. This calls for a capacity to cognitively receive and analyze large volumes of information
in these new and diverse situations.
• Developing new multilevel mental models. A global
mindset involves the capacity to quickly develop useful
mental models of situations, particularly at both a local
and global level of analysis. Ultimately, those with a
strong global mindset apply multiple levels of understanding to workplace issues in multicultural settings.
A global mindset offers tremendous value to organizations as well as to the employee’s career opportunities.89
Employees form better relationships across cultures by
understanding and showing respect to distant colleagues and
partners. They can sift through huge volumes of ambiguous
and novel information transmitted in multinational relationships. They have a capacity to form networks and to exchange
resources more rapidly across borders. They also develop
greater sensitivity and respond more quickly to emerging
global opportunities.
Developing a global mindset involves improving one’s perceptions, so the practices described earlier regarding awareness, self-awareness, and meaningful interaction are relevant.
As with most perceptual capabilities, a global mindset begins
with awareness of the concept, followed by self-awareness of
one’s current level of development. By understanding their
own beliefs, values, and attitudes, employees become more
open-minded and nonjudgmental when receiving and processing complex information for decision making. In addition,
companies develop a global mindset by providing opportunities for employees to compare their own mental models with
those of co-workers or partners from other regions of the
world. For example, employees might participate in online
forums about how well a product’s design or marketing strategy is received in Canada versus India or Chile. When companies engage in regular discussions about global competitors,
suppliers, and other stakeholders, they eventually move the
employee’s sphere of awareness toward that global level.
A global mindset develops through better knowledge of
people and cultures. Some of that knowledge is acquired
through formal programs, such as diversity training, but
deeper absorption results from immersion in those cultures.90 Just as executives need to experience front-line jobs
to better understand their customers and employees, employees also need to have meaningful interaction with colleagues
from other cultures in those cultural settings. The deeper the
immersion in the local environment (such as following local
practices, eating local food, and using the local language),
the greater the potential to understand the perspectives and
attitudes of colleagues in those cultures.
Chapter Summary
Describe the elements of self-concept and explain how each
affects an individual’s behaviour and well-being.
Self-concept includes an individual’s self-beliefs and self-evaluations. It has three structural characteristics—complexity, consistency,
and clarity—all of which influence employee well-being, behaviour,
and performance. People are inherently motivated to promote and
protect their self-concept (self-enhancement) and to verify and maintain their existing self-concept (self-verification). Self-evaluation
consists of self-esteem, self-efficacy, and locus of control. Selfconcept also consists of both personal identity and social identity.
Social identity theory explains how people define themselves by the
groups to which they belong or have an emotional attachment.
Outline the perceptual process and discuss the effects of categorical thinking and mental models in that process.
Perception involves selecting, organizing, and interpreting information to make sense of the world around us. Perceptual organization
applies categorical thinking—the mostly nonconscious process of
organizing people and objects into preconceived categories that are
stored in our long-term memory. Mental models—knowledge structures that we develop to describe, explain, and predict the world
around us—also help us make sense of incoming stimuli.
Discuss how stereotyping, attribution, self-fulfilling prophecy,
halo, false-consensus, recency, and primacy effects influence
the perceptual process.
Stereotyping occurs when people assign traits to others based on
their membership in a social category. This assignment economizes mental effort, fills in missing information, and enhances our
self-concept, but it also lays the foundation for stereotype threat
as well as systemic and intentional discrimination. The attribution process involves deciding whether an observed behaviour or
event is caused mainly by the person (internal factors) or the environment (external factors). Attributions are decided by perceived
consistency, distinctiveness, and consensus of the behaviour. This
process is subject to self-serving bias and fundamental attribution
Chapter Three
error. A self-fulfilling prophecy occurs when our expectations
about another person cause that person to act in a way that is
consistent with those expectations. This effect is stronger when
employees first join the work unit, when several people hold these
expectations, and when the employee has a history of low achievement. Four other perceptual errors commonly observed in organizations are the halo effect, false-consensus effect, recency effect,
and primacy effect.
Discuss three ways to improve perceptions, with specific
application to organizational situations.
One way to minimize perceptual biases is to become more aware
of their existence. Awareness of these biases makes people more
mindful of their thoughts and actions, but this training sometimes
reinforces rather than reduces reliance on stereotypes and tends to
be ineffective for people with deeply held prejudices. A second
strategy is to become more aware of biases in our own decisions
and behaviour. Self-awareness increases through formal tests such
as the IAT and by applying the Johari Window, which is a process
in which others provide feedback to you about your behaviour, and
you offer disclosure to them about yourself. The third strategy is
meaningful interaction, which applies the contact hypothesis that
people who interact will be less prejudiced or perceptually biased
Perceiving Ourselves and Others in Organizations 81
toward one another. Meaningful interaction is strongest when people work closely and frequently with relatively equal status on a
shared meaningful task that requires cooperation and reliance on
one another. Meaningful interaction tends to improve empathy,
which is a person’s understanding and sensitivity to the feelings,
thoughts, and situations of others.
Outline the main features of a global mindset and justify its
usefulness to employees and organizations.
A global mindset refers to an individual’s ability to perceive, know
about, and process information across cultures. This includes (1) an
awareness of, openness to, and respect for other views and practices in the world; (2) the capacity to empathize and act effectively
across cultures; (3) an ability to process complex information about
novel environments; and (4) the ability to comprehend and reconcile
intercultural matters with multiple levels of thinking. A global
mindset enables people to develop better cross-cultural relationships, to digest huge volumes of cross-cultural information, and to
identify and respond more quickly to emerging global opportunities. Employees develop a global mindset through self-awareness,
opportunities to compare their own mental models with people
from other cultures, formal cross-cultural training, and immersion
in other cultures.
Key Terms
attribution process
categorical thinking
confirmation bias
contact hypothesis
false-consensus effect
fundamental attribution error
global mindset
halo effect
Johari Window
locus of control
mental models
positive organizational behaviour
primacy effect
recency effect
selective attention
self-fulfilling prophecy
self-serving bias
social identity theory
stereotype threat
Critical Thinking Questions
1. You are manager of a district that has just hired several
recent university and college graduates. Most of these
people are starting their first full-time job, although most
or all have held part-time and summer positions in the
past. They have general knowledge of their particular
skill area (accounting, engineering, marketing, etc.) but
know relatively little about specific business practices
and developments. Explain how you would nurture the
self-concepts of these new hires to strengthen their performance and maintain their psychological well-being.
Also explain how you might reconcile the tendency for
self-enhancement while preventing the new employees
from forming a negative self-evaluation.
2. Do you define yourself in terms of the school you
attend? Why or why not? What are the implications of
your answer for your university or college?
Part Two
Individual Behaviour and Processes
3. A high-performance company has launched a “total
focus” initiative that requires all employees to give complete attention and dedication to the company’s growth
and success. In an email to all staff members, the CEO
wrote: “We live in a competitive world, and only those
businesses whose employees give their total focus to
the business will survive. As such, we are offering a
generous severance to employees leaving because they
can’t devote 110 percent to this firm.” The company
announced that it will invest heavily in employee training
and career development, but employees who hold second
jobs or have side businesses will be asked to leave. Discuss
the company’s “total focus” initiative and its consequences
from the perspective of employee self-concept complexity,
consistency, and clarity.
4. Several years ago, senior executives at Canadian energy
company CanOil wanted to acquire an exploration company (HBOG) that was owned by an American energy
company, AmOil. Rather than face a hostile takeover and
unfavourable tax implications, CanOil’s two top executives met with the CEO of AmOil to discuss a friendly
exchange of stock to carry out the transaction. AmOil’s
chief executive was unaware of CanOil’s plans, and as
the meeting began, the AmOil executive warned that he
was there merely to listen. The CanOil executives were
confident that AmOil wanted to sell HBOG because
energy legislation at the time made HBOG a poor investment for AmOil. AmOil’s CEO remained silent for most
of the meeting, which CanOil executives interpreted as
an implied agreement to proceed to buy AmOil stock on
the market. But when CanOil launched the stock purchase a month later, AmOil’s CEO was both surprised
and outraged. He thought he had given the CanOil executives the cold shoulder, remaining silent to show his
lack of interest in the deal. The misunderstanding nearly
bankrupted CanOil because AmOil reacted by protecting
its stock. What perceptual problem(s) likely occurred
that led to this misunderstanding?
5. Before joining an organization or beginning education
at a new school, we form mental models of what the
work setting and activities will be like. How did your
pre-employment or pre-enrollment mental models differ
from the actual situation? Why did your mental models
differ from reality, and what effect did those differences
have on your adjustment to the new work or school?
6. During a diversity management session, a manager suggests that stereotypes are a necessary part of working with
others. “I have to make assumptions about what’s in the
other person’s head, and stereotypes help me do that,” she
explains. “It’s better to rely on stereotypes than to enter a
working relationship with someone from another culture
without any idea of what they believe in!” Discuss the
merits of and problems with the manager’s statement.
7. Describe how a manager or coach could use the process
of self-fulfilling prophecy to enhance an individual’s
8. Self-awareness is increasingly recognized as an important ingredient for effective leadership. Suppose that you
are responsible for creating a leadership development
program in a government organization. What activities
or processes would you introduce to help participants in
this program constructively develop better self-awareness
of their personality, values, and personal biases?
9. Almost everyone in a college or university business
program has developed some degree of global mindset.
What events or activities in your life have helped to nurture the global mindset you have developed so far? What
actions can you take now, while still attending school, to
further develop your global mindset?
Case Study:
by Steven L. McShane, University of Newcastle (Australia)
Syd Gilman read the latest sales figures with a great deal of
satisfaction. The vice-president of marketing at Hy Dairies
Ltd., a large Canadian milk products manufacturer, was
pleased to see that the marketing campaign to improve sagging sales of Hy’s gourmet ice cream brand was working.
Sales volume and market share of the product had increased
significantly over the past two quarters compared with the
previous year.
The improved sales of Hy’s gourmet ice cream could
be credited to Rochelle Beauport, who was assigned to the
gourmet ice cream brand last year. Beauport had joined Hy
less than two years ago as an assistant brand manager after
leaving a similar job at a food products firm. She was one
of the few women of colour in marketing management at
Hy Dairies and had a promising career with the company.
Gilman was pleased with Beauport’s work and tried to let
her know this in the annual performance reviews. He now
had an excellent opportunity to reward her by offering her
the recently vacated position of marketing research coordinator. Although technically only a lateral transfer with a
Chapter Three
modest salary increase, the marketing research coordinator job would give Beauport broader experience in some
high-profile work, which would enhance her career with Hy
Dairies. Few people were aware that Gilman’s own career
had been boosted by working as marketing research coordinator at Hy several years earlier.
Rochelle Beauport had also seen the latest sales figures on
Hy’s gourmet ice cream and was expecting Gilman’s call to
set up a meeting that morning. Gilman began the conversation by briefly mentioning the favourable sales figures, and
then explained that he wanted Beauport to take the marketing
research coordinator job. Beauport was shocked by the news.
She enjoyed brand management and particularly the challenge
involved with controlling a product that directly affected the
company’s profitability. Marketing research coordinator was a
technical support position—a “backroom” job—far removed
from the company’s bottom-line activities. Marketing research
was not the route to top management in most organizations,
thought Beauport. She had been sidelined.
After a long silence, Beauport managed a weak “Thank
you, Mr. Gilman.” She was too bewildered to protest. She
wanted to collect her thoughts and reflect on what she had
done wrong. Also, she did not know her boss well enough to
be openly critical.
Gilman recognized Beauport’s surprise, which he naturally assumed was her positive response to hearing of this
wonderful career opportunity. He, too, had been delighted
several years earlier about his temporary transfer to marketing
Perceiving Ourselves and Others in Organizations 83
research to round out his marketing experience. “This move
will be good for both you and Hy Dairies,” said Gilman, as
he escorted Beauport from his office.
Beauport was preoccupied with several tasks that afternoon, but was able to consider the day’s events that evening.
She was one of the top women and few minorities in brand
management at Hy Dairies and feared that she was being
sidelined because the company didn’t want women or people of colour in top management. Her previous employer had
made it quite clear that women “couldn’t take the heat” in
marketing management and tended to place them in technical
support positions after a brief term in lower brand-management
jobs. Obviously, Syd Gilman and Hy Dairies were following
the same game plan. Gilman’s comments that the coordinator
job would be good for her was just a nice way of saying that
Beauport couldn’t go any further in brand management at
Hy Dairies.
Beauport now faced the difficult decision of whether to
confront Gilman and try to change Hy Dairies’ sexist and
possibly racist practices or to leave the company.
Discussion Questions
1. Apply your knowledge of stereotyping and self-concept
to explain what went wrong here.
2. What other perceptual error is apparent in this case study?
3. What can organizations do to minimize misperceptions
in these types of situations?
Team Exercise:
Purpose This exercise is designed to help you understand
and discover ways to improve your global mindset.
Materials None.
Step 1: Students are organized into teams, in which the following questions will be discussed. Teams will prepare a list
of global mindset–enhancing activities organized around
two categories: (1) organizationally generated activities and
(2) personal development activities.
• Organizationally generated activities: What organizational practices—interventions or conditions created
deliberately by the organization—have you experienced
or know that others have experienced that develop a person’s global mindset? Be specific in your description of
each activity and, where possible, identify the element
(elements) of global mindset that improves through that
• Personal development activities: Suppose someone asked
you what personal steps they could take to develop a
global mindset. What would you recommend? Think
about ways that you have personally developed your
(or have good knowledge of someone else who has
developed their) global mindset. Your suggestions
should say what specific elements of global mindset
are improved through each activity.
Step 2: The class debriefs, where teams are asked to describe
specific personal or organizational activities to others in
the class. Look for common themes, as well as challenges
people might face while trying to develop a global mindset.
Part Two
Individual Behaviour and Processes
Self-Assessments for Chapter 3
How much does work define
your self-concept?
Work is part of our lives. Some people view work as central to their identity as individuals, whereas
others consider work to be secondary to other life interests. This self-assessment estimates the extent
to which work is central to your self-concept.
How much general
self-efficacy do you have?
Self-efficacy refers to a person’s belief that they have the ability, motivation, and resources to complete a task successfully. Although self-efficacy is often situation-specific, people also develop a more
general self-efficacy if they perform tasks in a variety of situations. This self-assessment estimates
your general self-efficacy.
What is your locus
of control?
Locus of control is one component of self-evaluation, which is part of an individual’s self-concept.
It is a person’s general belief about the amount of control they have over life events. This self-assessment
estimates the extent to which you have an internal or external locus-of-control.
How much perceptual structure do you need?
Some people have a greater need than do others to quickly or completely “make sense” of things around
them. This personal need for perceptual structure relates to selective attention as well as perceptual
organization and interpretation. This self-assessment estimates your personal need for perceptual
How strong is your
perspective taking
(cognitive empathy)?
Empathy refers to a person’s understanding of and sensitivity to the feelings, thoughts, and situation
of others. The “understanding” part of empathy is called perspective taking or cognitive empathy.
It refers to a rational understanding of another person’s circumstances. This self-assessment estimates
how well you cognitively understand another person’s situational and individual circumstances.
How strong is your
emotional empathy?
Empathy refers to a person’s understanding of and sensitivity to the feelings, thoughts, and situation
of others. The “sensitivity” part of empathy is called emotional empathy. It refers to experiencing
the feelings of the other person. This self-assessment estimates how well you are able to experience the
emotions or feelings of another person.
Workplace Emotions, Attitudes, and Stress
After reading this chapter, you should be able to:
LO1 Explain how emotions and cognition (conscious reasoning) influence attitudes and
LO2 Discuss the dynamics of emotional labour and the role of emotional intelligence in
the workplace.
LO3 Summarize the consequences of job dissatisfaction as well as strategies to increase
organizational (affective) commitment.
LO4 Describe the stress experience and review four major stressors.
LO5 Identify five ways to manage workplace stress.
Employee emotions and attitudes are important
at Quebec City, so much so that the municipality
conducts a weekly digital pulse survey consisting of a few questions to check in on how staff
are feeling. Quebec City’s leaders keep track of
the results on a chart called “Moral des Troupes”
(Morale of the Troops). The chart is currently filled
with green dots, indicating that employee emotions and attitudes have been consistently at the
positive end of the range.
Frequent pulse surveys give employees the
opportunity to more accurately communicate their
current emotions, rather than a vague recollecEmployee emotions and attitudes are so important
tion of how they felt over the previous year. They
at Quebec City, CAE Inc., and other Canadian
organizations that they rely on pulse surveys to regularly
also give organizational leaders real-time awarecheck in on employee feelings.
ness of emerging morale issues. “We listen to
©PHOVOIR/Alamy Stock Photo
our employees’ feedback through biweekly pulse
surveys, and we react quickly,” says Marc Parent,
CEO of CAE, the Montreal-based world leader in simulation technologies.
Companies also create special pulse surveys to quickly gauge employee feelings about specific, timely
issues such as the devastating COVID-19 pandemic. “In normal times, we conduct a quarterly pulse survey
to keep on top of employee satisfaction,” explains an executive at an American e-commerce platform. “This
week, we conducted a quick COVID-related version to check in on employees and understand their feelings
regarding a variety of topics.” The pulse check discovered that employees’ top concerns were about working from home, health risks of the virus, and how the virus might affect the company’s financial situation.
Part Two
Individual Behaviour and Processes
“Pulse surveys can be an extremely effective platform for capturing employee input, especially when
using an anonymous and easy-to-use interface, such as single-click surveys,” says Natalie Baumgartner,
chief workforce scientist at Achievers, a Toronto-based company that develops a popular digital platform
for employee recognition and rewards. “Offering a fast and secure way for employees to voice their opinion can give businesses a clear understanding of the engagement of their people and insight into their
views on particular issues.”1
Quebec City, CAE, and other Canadian organizations recognize that emotions and attitudes influence employee
behaviour and well-being, and ultimately affect the organization’s performance and customer service. The field of
organizational behaviour has experienced a major shift in
thinking about workplace emotions. This chapter begins by
introducing the concept and explaining its relationship to
attitudes and behaviour. Next, we consider the dynamics of
emotional labour, followed by the popular topic of emotional
intelligence. The specific work attitudes of job satisfaction
and organizational commitment are then discussed, including their association with various employee behaviours and
work performance. The final section looks at work-related
stress, including the stress experience, four prominent stressors, individual differences in stress, and ways to combat
excessive stress.
Emotions in the Workplace
Emotions influence almost everything we do in the workplace. This is a strong statement, and one that would have
rarely been expressed by organizational behaviour experts
two decades ago. Most OB theories still assume that a
person’s thoughts and actions are governed primarily or
exclusively by logical thinking (called cognition).2 Yet
groundbreaking neuroscience discoveries have revealed that
our perceptions, attitudes, decisions, and behaviour are influenced by emotions as well as cognition.3 In fact, emotions
may have the greater influence because they often occur
before cognitive processes and, consequently, influence
the latter. By ignoring emotionality, many theories have
overlooked a large piece of the puzzle concerning human
behaviour in the workplace.
Emotions are physiological, behavioural, and psychological episodes experienced toward an object, person, or event
that create a state of readiness.4 These “episodes”
emotions Physiological,
behavioural, and psychological
are very brief events, some
episodes experienced toward
lasting less than a secan object, person, or event that
ond. However, we usually
create a state of readiness.
experience emotions over
several minutes or longer because they occur in waves as we
continue to think about the source of the emotion. Emotions
are directed toward someone or something. For example, we
experience joy, fear, anger, and other emotional episodes
toward tasks, customers, or a mobile phone app we are using.
This differs from moods, which are not directed toward anything in particular and tend to be longer-term background
emotional states.
Emotions are experiences. They represent changes in
our physiological state (e.g., blood pressure, heart rate),
psychological state (e.g., thought process), and behaviour
(e.g., facial expression).5 Most emotional reactions are subtle; they occur without our awareness. This is an important
point because the topic of emotions often conjures up images
of people “getting emotional.” In reality, most emotions are
fleeting, nonconscious events that influence our conscious
thinking and behaviour.6 Finally, emotions put us in a state
of readiness. When we get worried, for example, our heart
rate and blood pressure increase to make our body better
prepared to engage in fight or flight. Strong emotions trigger our conscious awareness of a threat or opportunity in the
external environment. The “state of readiness” generated by
emotions is the engine of our motivation, which we discuss
more fully in Chapter 5.7
People experience many emotions and various combinations
of emotions, but all of them have two common features,
illustrated in Exhibit 4.1.8 One feature is that emotions vary
in their level of activation. By definition, emotions put us in
a state of readiness and, as we discuss in the next chapter,
they are the primary source of a person’s motivation. Some
emotional experiences, such as when we are suddenly surprised, are strong enough to consciously motivate us to act
without careful thought. Most emotional experiences are
more subtle, but even they activate enough to make us more
aware of our environment.
The second feature is that all emotions evaluate the situation as positive or negative, good or bad, helpful or harmful,
and so forth. In other words, all emotions have an associated
valence (called core affect), signalling that the perceived
object or event should be approached or avoided. Negative
Chapter Four
Workplace Emotions, Attitudes, and Stress 87
If employees are experiencing the wrong emotions or moods,
it may be time to change the lighting. Almost a century ago,
MIT and Harvard researchers dismissed the effects of lighting
on human thoughts and behaviour, whereas numerous
recent studies report that lighting intensity and warmth can
influence emotions and moods. Bright white lighting tends to
increase employee alertness and vitality, resulting in faster
reaction times on tasks. Moderate intensity warm lighting
seems to improve interpersonal relations, whereas lowintensity cool lighting reduces socially oriented emotions and
motivation. The combination of light intensity and warmth
also influences how much employees regulate their emotions
in that setting.*
* K.C.H.J. Smolders and Y.A.W. de Kort, “Bright Light and Mental Fatigue:
Effects on Alertness, Vitality, Performance and Physiological Arousal,” Journal
of Environmental Psychology, Light, Lighting, and Human Behaviour, 39
(2014): 77–91, https://doi.org/10.1016/j.jenvp.2013.12.010.; M.G. Figueiro
et al., “The Impact of Daytime Light Exposures on Sleep and Mood in Office
Workers,” Sleep Health 3, no. 3 (2017): 204–15, https://doi.org/10.1016/j.
sleh.2017.03.005; X. (Irene) Huang, P. Dong, and A.A. Labroo, “Feeling
Disconnected from Others: The Effects of Ambient Darkness on Hedonic
Choice,” International Journal of Research in Marketing 35, no. 1 (2018):
144–53, https://doi.org/10.1016/j.ijresmar.2017.12.005; L. Veenstra and
S.L. Koole, “Disarming Darkness: Effects of Ambient Lighting on Approach
Motivation and State Anger among People with Varying Trait Anger,” Journal
of Environmental Psychology 60 (2018): 34–40, https://doi.org/10.1016/j.
jenvp.2018.07.005; S.Y. Kang, N. Youn, and H.C. Yoon, “The Self-Regulatory
Power of Environmental Lighting: The Effect of Illuminance and Correlated Color
Temperature,” Journal of Environmental Psychology 62 (2019): 30–41, https://
Circumplex Model of Emotions
©oversnap/Getty Images
negative emotions
positive emotions
negative emotions
positive emotions
Part Two
Individual Behaviour and Processes
emotions tend to generate stronger levels of activation than
do positive emotions.9 Fear and anger, for instance, are more
intense experiences than are joy and delight, so they have
a stronger influence on our actions. This valence asymmetry likely occurs because negative emotions protect us from
harm and are therefore more critical for our survival.
To understand how emotions influence our thoughts and
behaviour in the workplace, we first need to know about attitudes. Attitudes represent the cluster of beliefs, assessed feelings, and behavioural intentions toward a person, object, or
event (called an attitude
attitudes The cluster of
object).10 Attitudes are judgbeliefs, assessed feelings,
ments, whereas emotions are
and behavioural intentions
experiences. In other words,
towards a person, object,
attitudes involve evaluaor event (called an attitude
tions of an attitude object,
whereas emotions operate
as events, usually without our awareness. Attitudes sometimes
operate nonconsciously, but most of the time we are aware of
and consciously think about our attitudes. Another distinction
is that we experience most emotions very briefly, whereas
our attitude toward someone or something is more stable
over time.11
Until recently, experts believed that attitudes could be
understood just by the three cognitive components illustrated on the left side of Exhibit 4.2: beliefs, feelings, and
behavioural intentions. Now evidence suggests that a parallel
emotional process is also at work, shown on the right side of
the exhibit.12 Using attitude toward mergers as an example,
let’s look more closely at this model, beginning with the traditional cognitive perspective of attitudes.
• Beliefs. Beliefs are your established perceptions about
the attitude object—what you believe to be true.13 For
example, you might believe that mergers reduce job
security for employees in the merged firms, or that mergers increase the company’s competitiveness in this era
of globalization. These beliefs are perceived facts that
you acquire from experience and other forms of learning.
Each of these beliefs also has a valence; that is, we have
a positive or negative feeling about each belief (e.g., less
job security is bad).
Model of Emotions, Attitudes, and Behaviour
Perceived environment
Cognitive process
Emotional process
Chapter Four
• Feelings. This element represents your conscious positive or negative evaluations of the attitude object. Some
people think mergers are good; others think they are bad.
Your positive or negative opinion of mergers represents
your assessed feelings. According to the traditional
cognitive perspective of attitudes (the left side of the
model), feelings are calculated from your beliefs about
mergers and the associated feelings about those beliefs.
Consider the example of your attitude toward mergers.
If you believe that mergers typically have negative consequences such as layoffs and organizational politics,
then you will form negative feelings toward mergers
in general or about a specific planned merger in your
• Behavioural intentions. Behavioural intentions represent your motivation to engage in a particular behaviour
regarding the attitude object.14 Upon hearing that the
company will merge with another organization, you
might become motivated to look for a job elsewhere or
possibly to complain to management about the merger
decision. Your feelings toward mergers motivate your
behavioural intentions, and which actions you choose
depends on your past experiences, personality, and social
norms of appropriate behaviour.
Attitude–Behaviour Contingencies
The cognitive model of attitudes (beliefs–feelings–
intentions) gives the impression that we can predict behaviour
from each element of an individual’s attitude. This is potentially true, but contingencies at each stage in the model can
weaken that predictability. Let’s begin with the beliefs–
feelings link. People with the same beliefs might form quite
different feelings toward the attitude object because they
have different valences for those beliefs. Two employees
who work for the same boss share the belief that their boss
makes them work hard. Yet one employee dislikes the boss
because of a negative valence toward hard work whereas the
other employee likes the boss because of a positive valence
toward hard work.
The effect of feelings on behavioural intentions also
depends on contingencies, particularly an individual’s personality, values, self-concept, experiences, and other personal characteristics. For instance, two employees might
equally dislike their boss, but one employee intends to complain to the union or upper management whereas the other
employee intends to find a job elsewhere. Later in this chapter, we describe the four main responses to dissatisfaction
and other negative attitudes.
Finally, the model indicates that behavioural intentions
are the best predictors of a person’s behaviour. However,
the strength of this link also depends on situational factors
Workplace Emotions, Attitudes, and Stress 89
as well as the person’s ability and role perceptions (see
the MARS model in Chapter 1). For example, two people
might intend to quit because they dislike their boss, but
only one does so because the other employee can’t find
another job.
The cognitive model describes attitude formation and
dynamics to some extent, but emotions also have a central
role in this process.15 The right side of Exhibit 4.2 illustrates this process, which (like the cognitive process) also
begins with perceptions of the world around us. Our brain
tags incoming sensory information with emotional markers
based on a quick and imprecise evaluation of whether that
information supports or threatens our innate drives. These
markers are not calculated feelings; they are automatic and
nonconscious emotional responses based on very thin slices
of sensory information.16 The experienced emotions then
influence our feelings about the attitude object.
Consider once again your attitude toward mergers. You
might experience worry, nervousness, or relief upon learning that your company intends to merge with a competitor.
The fuzzy dots on the right side of Exhibit 4.2 illustrate the
numerous emotional episodes you experience upon hearing
the merger announcement, subsequently thinking about the
merger, discussing the merger with co-workers, and so on.
These emotions are transmitted to your brain’s cognitive
centres, where they are logically analyzed along with other
information about the attitude object.17 So, while you are
consciously evaluating whether the merger is good or bad,
your emotions are already sending core affect (good–bad)
signals, and those emotional signals sway your conscious
evaluation. In fact, we often deliberately “listen in” on our
emotions to help us consciously decide whether to support or
oppose something.18
The influence of both cognitive reasoning and emotions
on attitudes is most apparent when they disagree with each
other. People occasionally experience this mental tug-ofwar, sensing that something isn’t right even though they can’t
think of any logical reason to be concerned. This internal
conflict or ambivalence indicates that the person’s logical
analysis of the situation (left side of Exhibit 4.2) generates
feelings that differ from the emotional response (right side
of Exhibit 4.2).19 Should we pay attention to our emotions or
our logical analysis? This question is not easy to answer, but
some studies indicate that logical analysis should play a central role in most decisions. Although executives are known to
make quick decisions based on their gut feelings (emotional
response), their best decisions tend to occur after logically
working through the alternatives.20
Part Two
Individual Behaviour and Processes
©Wayne Glowacki/Winnipeg Free Press
Canadian companies have long recognized the benefits of instilling fun into the workplace. At Toronto advertising firm
Grip Ltd., employees collaborate in funky spaces and descend to the main entrance via a bright orange slide. The three
dozen employees at Woodcock Cycle Works, Winnipeg’s largest cycling retailer (shown in this photo), enjoy after-hours
bike rides, bonfires, and pizza dinners. Toronto-based Lift & Co. generates positive emotions through quirky meetingroom names, such as Back of a U-Haul, University Dorm, and (for large meetings) the Banff National Park room. “It’s part
of the culture to make our spaces creative and fun,” explains Sara McMillen, director of communications at the cannabis
technology and events firm.”*
* F. McInnis, “Great Offices: An Ad Agency’s Quirky John Street Headquarters, Complete with Slide,” Toronto Life, 4 April 2013; J. Botelho-Urbanski, “Good
Job!,” Winnipeg Free Press, November 25, 2017; T. Deschamps, “Meet You in ‘Back of a U-Haul’’:Boardroom Names Get Weird as Firms Welcome More Fun
at Work,’”Toronto Star, August 12, 2019; “Grip Ltd.’s Creative Playground,” Apartment Therapy, accessed October 15, 2019, https://www.apartmenttherapy.
Many organizational leaders seem to be well aware of the
dual cognitive–emotional attitude process because they try to
craft a workplace that will generate more positive emotional
experiences.21 Google Inc. is famous for its superb perks,
including in-house coffee bars, gourmet cafeterias, conversation areas that look like vintage subway cars, personal development courses, game rooms, free haircuts, and slides to
descend to the floor below. Admiral Group, the U.K.’s toprated employer and one of the best places to work in Canada,
has a “Ministry of Fun” committee that introduces plenty
of positive emotions through Nintendo Wii competitions,
interdepartmental Olympics, and other fun activities. One of
the best places to work in the United States is Zoom Video
Communications, which also has an entire team—called the
happiness crew—at each location dedicated to maintaining a
positive and engaging workplace. “If you get an offer to work
at Zoom, take it,” advises a Zoom employee. “Zoom takes
employee happiness seriously and people genuinely love the
Some critics might argue that the organization’s main
focus should be to create positive emotions through the job
itself as well as through natural everyday occurrences, such
as polite customers and supportive co-workers. Still, most
people perform work that produces some negative emotions, and research has found that humour and fun at work—
whether natural or contrived—can potentially offset some of
the negative experiences.23 Overall, corporate leaders need
to keep in mind that emotions shape employee attitudes and,
as we will discuss later, attitudes influence various forms of
work-related behaviour.
One last comment about Exhibit 4.2: Notice the arrow
from the emotional episodes to behaviour. It indicates that
emotions can directly (without conscious thinking) influence
Chapter Four
a person’s behaviour. This occurs when we jump suddenly
if someone sneaks up on us. It also occurs in everyday situations because even low-intensity emotions automatically
change our facial expressions. These actions are not carefully
thought out. They are automatic emotional responses that are
learned or hardwired by heredity for particular situations.24
Imagine that you have just signed a contract for new digital
whiteboards to be installed throughout the company’s meeting rooms. The deal was expensive but, after consulting with
several staff, you felt that the technology would be valuable
in this technological age. Yet you felt a twinge of regret
soon after signing the contract. This emotional experience is
cognitive dissonance, which occurs when people perceive that
their beliefs, feelings, and behaviour are incongruent with each
other.25 The inconsistency
among these three attitude
cognitive dissonance An
components generates emoemotional experience
caused by a perception that
tions (such as feeling hypour beliefs, feelings, and
ocritical) that motivate the
behaviour are incongruent
person to create more conwith one another.
sistency by changing one or
more of them.
Why did you experience cognitive dissonance after purchasing the digital whiteboards? Perhaps you remembered
that some staff wanted flexibility, whereas the whiteboards
Workplace Emotions, Attitudes, and Stress 91
require special markers and computer software. Or maybe
you had a fleeting realization that buying digital whiteboards
costing several times more than traditional whiteboards is
inconsistent with your personal values and your company’s
culture of thriftiness. Whatever the reason, the dissonance
occurs because your attitude (it’s good to be cost conscious)
is inconsistent with your behaviour (buying expensive whiteboards). Most people like to think of themselves—and be
viewed by others—as rational and logical. Cognitive dissonance occurs when our behaviour and beliefs conflict, which
is not so rational.
How do we reduce cognitive dissonance?26 Most
behaviours can’t be undone or are too expensive to reverse.
Also, reversing the behaviour rarely reduces dissonance
because the event is publicly known—you and your co-workers
already know that you bought the digital whiteboards and
did so willingly.
People typically reduce cognitive dissonance by changing
their beliefs and feelings. One dissonance-reducing strategy is to
amplify or discover additional positive features of their selected
alternative (e.g., the boards can change handwriting into typed
text). A second strategy is to amplify or discover additional
problems or weaknesses with the alternatives they didn’t choose
(e.g., traditional boards are poor projection screens).
A third strategy is more indirect; rather than trying to
ignore the high price of the digital whiteboards, you reduce
dissonance by emphasizing how your other decisions have
been frugal. This framing compensates for your expensive
“Fun at work” has become such a hot business fad that
companies without a “fun” committee are considered
insensitive taskmasters. Having fun at work can improve
employee attitudes in many situations, but are special fun
events really necessary or beneficial?
Some critics vote No! They argue that contrived fun
events at work can backfire.* Some types of fun aren’t
fun at all to some people. In fact, many employees might
be offended by the silliness of some activities contrived
by management or a few staff. Others resent having fun
forced on them. One expert warned, “Once the idea of
fun is formally institutionalized from above, it can lead to
employees becoming resentful. They feel patronized and
condescended, and it breeds anger and frustration.”**
The meaning and value of fun at work might also vary
across generations; what works for Millennials could backfire for Baby Boomers and vice versa. Another concern
is that fun-focused companies might take their eye off
the bottom line. “At the end of the day, you have to make
money to stay here,” says Mike Pitcher, former CEO of
LeasePlan USA (which does have a “fun” committee). “If
work was [all] fun, they’d call it fun.”***
* D.L. Collinson, “Managing Humour,” Journal of Management Studies 39, no. 3 (2002): 269–88; K. Owler, R. Morrison, and B. Plester, “Does Fun Work? The
Complexity of Promoting Fun at Work,” Journal of Management and Organization 16, no. 3 (2010): 338–52; B. Plester, H. Cooper-Thomas, and J. Winquist, “The
Fun Paradox,” Employee Relations 37, no. 3 (2015): 380–98.
** M. McLaughlin. “Bosses Blind to Horrors of ‘Fun Days’.” Scotland on Sunday, 3 January 2010, 10.
*** M. Tierney. “They’re All in It Together” Atlanta Journal-Constitution, 16 April 2011, G7. This view was also emphasized by a German business leader:
“Schumpeter: Down with Fun,” Economist Intelligence Unit, Executive Briefing (London), September 22, 2010.
Part Two
Individual Behaviour and Processes
What is your emotional personality? You can discover your emotional trait tendencies by completing
this self-assessment in Connect.
whiteboard fling and thereby maintains your self-concept
and public image as a thrifty decision maker. Each of these
mental acrobatics maintains some degree of consistency
between the person’s behaviour (buying expensive whiteboards) and attitudes (being thrifty).
Throughout this section, we have implied that emotional experiences are triggered by workplace experiences. This is mostly
true, but emotions are also partly determined by an individual’s personality.27 Individuals with higher emotional stability
and extraverted personalities (see Chapter 2) tend to experience more positive emotions. Those with higher neuroticism
(lower emotional stability) and introverted personalities tend
to experience more negative emotions. Although positive and
negative emotional traits have some effect, studies have found
that the actual situation in which people work has a noticeably
stronger influence on their attitudes and behaviour.28
Managing Emotions at Work
Employees are expected to manage their emotions in the workplace. They must conceal their frustration when serving an
irritating customer, display compassion to an ill patient, and
hide their boredom in a long meeting with other executives.
These are all forms of emotional labour—the effort, planning, and control needed
to express organizationally
emotional labour The effort,
desired emotions during
planning, and control needed
to express organizationally
interpersonal transactions.29
desired emotions during interAlmost everyone is
personal transactions.
required to abide by display rules. These norms or
explicit rules require employees to display behaviours representing specific emotions and to hide observable evidence
of other emotions. Emotional labour demands are higher in
jobs requiring a variety of emotions (e.g., anger as well as
joy) and more intense emotions (e.g., showing delight rather
than smiling weakly), as well as in jobs where interaction
with clients is frequent and longer. Emotional labour also
increases when employees must precisely rather than casually abide by the display rules.30 This work requirement is
most common in service industries, where employees have
frequent face-to-face interaction with clients.
Employees sometimes need to show emotions that are
quite different from---sometimes opposite to---the emotions
they actually experience at that moment. For instance, they
must display patience and positive feelings toward an irate
customer who they actually dislike. This incongruence produces a stressful emotional tension and requires considerably
more mental effort than when the emotional display rules are
similar to the employee’s actual emotions at that moment.
Emotional labour may also require employees to act contrary
to their self-concept, which can lead to psychological separation from self as well as job dissatisfaction.31
The extent to which employees are expected to hide their true
emotions varies considerably across cultures.32 One large
global study reports that several countries in Asia and Africa
strongly discourage emotional expression. Instead, people are expected to be subdued, have relatively monotonic
voice intonation, and avoid physical movement and touching
that display emotions. In contrast, several Latin and Middle
Eastern cultures allow or encourage more vivid display of
emotions and expect people to act more consistently with
their true emotions. In these cultures, people are expected to
reveal their thoughts and feelings, be dramatic in their conversational tones, and be animated in their use of nonverbal behaviours. For example, 81 percent of Ethiopians and
74 percent of Japanese in the study agreed that it is considered
unprofessional to overtly express emotions in their culture,
whereas 43 percent of Americans, 33 percent of Italians, and
only 19 percent of Spaniards, Cubans, and Egyptians agreed
with that statement.33
Many Asian countries have cultural norms that discourage public display of intense emotions (anger,
delight, etc.), whereas these emotion display norms are
weaker in North America, Europe, and many other cultures. Furthermore, when required to suppress their true
emotions at work, employees from cultures that tolerate or encourage emotional expression experience more
stress and lower life satisfaction compared to co-workers
from cultures that discourage emotional expression. One
Chinese company even tried to reduce employee stress by
holding a “no-face” day, in which employees wore masks
so they didn’t need to worry about the emotions their faces
Chapter Four
Workplace Emotions, Attitudes, and Stress 93
Global Connections 4.1
When Russia prepared to host the 21st World Cup, it
taught train conductors and other customer-facing
employees how to smile at foreigners. “Russian people
usually don’t smile,” explains a trainer involved in the
smile program. “That’s why when other people come to
Russia, they think Russians are not friendly.”
Even in customer service roles, Russians have a reputation of being more forthright and dour than Canadians.
However, the low prospect of a smile from Russian
employees doesn’t mean that they are unhappy or dislike
you. Russians just have a different interpretation of smiling than do people in Canada and most other Western
societies. Consequently, Russians likely experience more
emotional labour when forced to smile at customers.
One recent study found that people in Russia and
several other cultures (Japan, Korea, Iran, France,
etc.) tend to view strangers who smile often as less
intelligent. This is reflected in the well-known Russian
proverb: “Smiling for no reason is a sign of stupidity.”
In contrast, frequent smiling is interpreted as a sign of
higher intelligence in several other cultures, particularly
Germany, Switzerland, Malaysia, China, and Austria.
According to the recent cross-cultural study on smiling, societies with high levels of corruption view people
(particularly men) who smile fairly often as less honest
than nonsmiling strangers. Russia has a high corruption
score, so Russians have less trust in people who smile.
Russian film director Yulia Melamed recently experienced this when she was stopped by a police officer in Moscow and asked to show her identification.
After doing so, she asked why the officer stopped
her. “Because you were smiling,” he replied. Melamed
explains that in Russia “it is strange for a person to walk
on the street and smile. It looked alien and suspicious.”
©ZUMA Press, Inc./Alamy Stock Photo
* K. Krys et al., “Be Careful Where You Smile: Culture Shapes Judgments of Intelligence and Honesty of Smiling Individuals,” Journal of Nonverbal Behavior
40, no. 2 (2016): 101–16, https://doi.org/10.1007/s10919-015-0226-4; S. Rosenberg, “Why Russians Are Being Taught to Smile,” BBC News (London: BBC,
June 9, 2018); C. Baker, “What a Russian Smile Means,” Nautilus, June 21, 2018.
Emotional labour is ultimately about displaying expected
emotions through facial expressions and other behaviour.
Two general approaches to emotional labour are (a) pretending to have the expected emotions by consciously trying to
display behaviours depicting those emotions, and (b) actively
changing our perceptions and situation so they naturally produce the expected emotions and associated behaviours.
The first approach— consciously pretending to display the
expected emotions—is known as surface acting. For example,
we try to show interest in a client’s lengthy explanation even
though we are actually weary from hearing it. We act out the
verbal and nonverbal behaviours that symbolize the expected
emotions, even though our actual emotions are quite different.35
Surface acting is usually (but not always) a poor strategy for emotional labour. It requires considerable mental
effort that is often stressful and alienating from the role.36
Pretending to feel particular emotions is also challenging.
A genuine emotion automatically activates a complex set
of facial muscles and body positions, all of which are difficult to replicate when pretending to have this emotion.
Meanwhile, our true emotions tend to reveal themselves as
subtle gestures, usually without our awareness. More often
than not, observers recognize fake emotions, which undermines the social exchange.37
Regulating Emotions
The second approach to displaying the expected emotions
is to actually experience those emotions (rather than faking
them). In other words, we consciously alter our perceptions
or situation to naturally generate the desired emotions and
the behaviours that display those emotions. There are five
main strategies for regulating our emotions.38
• Change the situation. This approach involves moving out
of or into work settings that produce or avoid specific
emotions. One example would be temporarily leaving a
Part Two
Individual Behaviour and Processes
work area that makes us feel lethargic. At the same time,
we might have a short walking break outside to regain
our vigour. Another example is keeping away from a particular client who is deeply irritating.
• Modify the situation. Within the same physical location,
people modify that setting to create or avoid specific
emotions. For instance, we might stop working on a task
that is aggravating and move to a more enjoyable task
so that we don’t experience (and display) a sour demeanour. Or, if a discussion with co-workers becomes awkward or sensitive (such as discussing national politics),
we might shift the conversation to a less emotionally
laden topic.
• Suppress or amplify emotions. This strategy involves
consciously trying to block out thoughts that produce
dysfunctional emotions or more actively think about
things that produce expected emotions.39 For instance,
some medical staff suppress their emotional responses to
patient suffering by maintaining an impersonal relationship with patients.
• Shift attention. This strategy involves changing the focus
of our attention. Suppose that earlier today you led a client presentation that didn’t go well. To minimize the negative emotions of that event, you might engage in work
(such as another project with co-workers) that takes your
mind off the flawed presentation.
• Reframe the situation. Reframing is a cognitive
re-evaluation of a particular event that generates more
desirable emotions. Rather than viewing a client presentation as a failure, you might reframe the event as a
learning moment that had a low probability of success.
Flight attendants apply reframing when they define an
incident with an unruly passenger as a test of their customer service skill. These interactions are challenging
accomplishments rather than dreaded chores.40
Employees who actually produce the emotions that are
expected in a particular situation are engaging in deep
acting, whereas surface acting pretends to have a desired
emotion by acting out the behaviour associated with that
emotion.41 All five emotion-regulation strategies generate
deep acting, but reframing the situation and shifting attention are likely the most common. Changing and modifying
the situation can be applied when employees work alone, but
seldom when attending a client meeting, interacting with an
upset passenger, or in most other work-related social interactions. Suppressing or amplifying emotions produces deep
acting, but these cognitive activities may actually involve
reframing the situation and shifting attention. But no matter which strategy is applied to manage emotions, emotion regulation requires emotional intelligence, which we
discuss next.
Emotional Intelligence
The University of South Florida (USF) College of Medicine
discovered from surveys that its graduates required emotional intelligence training to perform their jobs better. Now,
some of its students enrol in a special program that “focuses
on values-based care, leadership, health care systems and
emotional intelligence.” The program includes coaching
and role-modeling by hospital staff at Lehigh Valley Health
Network, which helps medical students to develop their ability to understand and manage emotions. “I use the emotional
intelligence concepts nearly every minute of my day,” says
a physician who graduated from USF’s medical program.42
The University of South Florida Health and many other
organizations have embraced the idea that emotional
intelligence (EI) improves performance in many types of
jobs. Emotional intelligence includes a set of
emotional intelligence (EI) A
abilities that enable us to
set of abilities to perceive and
express emotion, assimilate
recognize and regulate our
emotion in thought, underown emotions as well as
stand and reason with emothe emotions of other peotion, and regulate emotion in
ple. This definition refers to
oneself and others.
the four main dimensions
shown in Exhibit 4.3. 43
• Awareness of our own emotions. This is the ability to
perceive and understand the meaning of our own emotions. People with higher emotional intelligence have
better awareness of their emotions and are better able to
make sense of them. They can eavesdrop on their emotional responses to specific situations and use this awareness as conscious information.44
• Management of our own emotions. Everyone manages
their own emotions to some extent. We suppress disruptive impulses and try not to feel angry or frustrated when
events go against us. We try to feel joy and happiness
toward others on such occasions. We re-energize ourselves to break out of midday lethargy. More generally,
management of our own emotions involves deep acting
and the associated emotion regulation practices described
• Awareness of others’ emotions. This dimension refers to
the ability to perceive and understand the emotions of
other people.45 It relates to empathy—having an understanding of and sensitivity to the feelings, thoughts, and
situations of others (see Chapter 3). This ability includes
understanding the other person’s situation, experiencing their emotions, and knowing their needs even when
unstated. Awareness of others’ emotions also includes
being organizationally aware, such as sensing office politics and the presence of informal social networks.
Chapter Four
Workplace Emotions, Attitudes, and Stress 95
How well do you recognize and regulate emotions? You can discover your perceived level of
emotional intelligence by completing this self-assessment in Connect.
Dimensions of Emotional Intelligence
of Emotions
Awareness of
our own emotions
Awareness of
others’ emotions
of Emotions
Management of
our own emotions
Management of
others’ emotions
• Management of others’ emotions. This dimension of EI
refers to managing other people’s emotions. It includes
consoling people who feel sad, emotionally inspiring
team members to complete a class project on time, getting strangers to feel comfortable working with you, and
dissipating co-worker stress and other dysfunctional
emotions that they experience.
The four dimensions of emotional intelligence form a
foundational hierarchy.46 Awareness of your own emotions
is the lowest foundation in that hierarchy because you need
awareness to engage in the higher levels of emotional intelligence. You can’t manage your own emotions if you don’t
know what they are. Managing other people’s emotions is the
highest level of EI because this ability requires awareness of
your own and others’ emotions. To diffuse an angry conflict
between two employees, for example, you need to understand
the emotions they are experiencing and manage your emotions (and display of emotions). To manage your own emotions, you also need to be aware of your current emotions.
Most jobs involve social interaction with co-workers or external stakeholders, so employees need emotional intelligence
to work effectively.47 Studies suggest that people with high
EI are more effective team members, perform better in jobs
requiring emotional labour, make better decisions involving other people, and maintain a more positive mindset for
creative work. EI is also associated with effective leadership
because leaders engage in emotional labour (e.g., showing
patience to employees even when they might feel frustrated)
and actively regulate the emotions of others (e.g., generating
staff optimism after they lost an important contract). However,
emotional intelligence does not improve some forms of performance, such as tasks with minimal social interaction.48
Given the potential value of emotional intelligence, it’s
not surprising that organizations try to measure this ability
in job applicants. Slightly more than half of Australian and
U.K. managers recently surveyed say they actively consider
the emotional intelligence of job applicants during the hiring process.49 Several organizations have also introduced
training programs to improve employees’ emotional intelligence.50 For instance, new hires at Fidelity Canada take
emotional intelligence training along with other soft skills
and technical education. The San Diego Police Department
conducts a course in which officers develop emotional intelligence and effective communication skills, including deescalation role-playing scenarios. Emotional intelligence also
increases with age; it is part of the process called maturity.
So far, this chapter has introduced the model of emotions
and attitudes, as well as emotional intelligence, as the means
by which we manage emotions in the workplace. The next
two sections look at two specific attitudes: job satisfaction
and organizational commitment. These two attitudes are so
important in our understanding of workplace behaviour that
some experts suggest the two combined should be called
“overall job attitude.”51
Part Two
Individual Behaviour and Processes
Global Connections 4.2
Indian Railways, the largest employer in India, is experiencing rapid change, and it requires managers with high
emotional intelligence to effectively lead that change.
“Indian Railways is right now going through substantial
transformation,” explains a senior trainer at the company’s management development centre. “There was thus
a need to build capabilities that complement transformation efforts. The change champion has to be emotionally intelligent.”
Thousands of managers are attending workshops
to help them understand emotional intelligence and
its relevance to their leadership roles every day. They
complete a well-known emotional intelligence test
developed by a Canadian company. This is followed by
feedback and coaching to help the managers improve
weaker aspects of their emotional intelligence.
Indian Railways managers who have completed
the workshops say that having higher emotional intelligence will result in better management–labour union
relations, leadership of employees, decision making,
and customer service. “Coping with stressful or difficult
situations and believing that one can manage or influence situations in a positive manner is the main aim of
the EI module,” says one divisional railway manager.
Indian Railways Board chairman Ashwani Lohani,
who initiated the massive program, suggests that it is
part of a larger strategy toward executive development.
“Emotional intelligence is just one component of a
larger canvas of better training for railway officers. My
emphasis across the organization is ‘satyanishtha’—a
mission for inculcating ethics and integrity among our
employees. EI is an input in that direction.”
©Kumar Sriskandan/Alamy Stock Photo
* “Railways Plans to Improve Senior Leaders’ EQ,” Mint (India), November 16, 2018; “To Improve Service, Railways to Give Emotional Intelligence Training
to Its Officers,” India Today, December 17, 2018; S.N. Sharma, “Can Emotional Intelligence Training for Staff Make Indian Railways Safer? [Railways],” The
Economic Times (India), December 23, 2018.
Job Satisfaction
When people mention work attitudes, they are typically referring to job satisfaction, a person’s evaluation of their job and
work context.52 It is an appraisal of the perceived job characteristics, work environment, and emotional experiences at
work. Satisfied employees
job satisfaction A person’s
have a favourable evaluevaluation of their job and
ation of their jobs, based
work context.
on their observations and
emotional experiences. Job
satisfaction is best viewed as a collection of attitudes about
different aspects of the job and work context. You might like
your co-workers but be less satisfied with your workload,
for instance.
How satisfied are employees at work? The answer depends
on the person, the workplace, and the country. Global surveys, such as the one shown in Exhibit 4.4, estimate that job
satisfaction tends to be highest in India, Mexico, and some
Nordic countries (such as Denmark and Norway). In this
and several other surveys, job satisfaction among Canadians
is around the global average or above average. The lowest levels of overall job satisfaction are typically reported
in some Asian countries (such as Japan, Hong Kong, and
Can we conclude from these surveys that most employees in India and Mexico are happy at work? Possibly, but
their overall job satisfaction probably isn’t as high as these
statistics suggest. One problem is that surveys often ask a
single direct question, such as: “How satisfied are you with
your job?” Many dissatisfied employees are reluctant to
Chapter Four
Workplace Emotions, Attitudes, and Stress 97
Job Satisfaction in Selected Countries*
Note: Percentage of employees in each country who said they are, in general, satisfied or very satisfied working for their current employer.
Survey data were collected in 2019 for Randstad Holdings nv, with a minimum of 400 employees in each country. This exhibit shows results
from selected countries across the full range of 34 countries studied.
* “Randstad Workmonitor Q3 2019” (Amsterdam: Randstad Holding nv, September 5, 2019). Survey data were collected from 34 countries with a minimum of 400 interviews per country of adults working 24 or more hours per week. Respondents were asked: “How satisfied are you in general about working with your current employer?”
reveal their feelings to such a direct question because this
is tantamount to admitting that they made a poor job choice
and are not enjoying a large part of their life. The inflated
results are evident in the fact that employees tend to report
less satisfaction when asked about specific aspects of their
work. For instance, 79 percent of Canadian federal government employees agree or strongly agree that they like their
job overall, yet only 53 percent are satisfied with how interpersonal issues are resolved in their work unit, and only
67 percent would recommend their department or agency as
a great place to work.54
A second problem is that cultural values make it difficult to compare job satisfaction across countries. People in
Japan tend to subdue their emotions in public, and there is
evidence that they also avoid extreme survey ratings such as
“very satisfied.” A third problem with job satisfaction ratings
is that job satisfaction changes with economic conditions.
Employees with the highest job satisfaction in current surveys tend to be in countries where the economies are chugging along quite well.55
Does job satisfaction influence workplace behaviour? In
general, yes! Job satisfaction affects many of the individual behaviours introduced in Chapter 1 (task performance,
organizational citizenship, quitting, absenteeism, etc.).56
However, a more precise answer is that the effect of job satisfaction and dissatisfaction on individual behaviour depends
on the person and the situation. A useful template for organizing and understanding the consequences of job dissatisfaction is the exit-voice-loyalty-neglect (EVLN) model.
As the name suggests, the EVLN model identifies four ways
that employees respond to
(EVLN) model The four ways,
• Exit. Exit includes leavas indicated in the name, that
ing the organization,
employees respond to job
transferring to another
work unit, or at least
trying to get away from the dissatisfying situation. The
traditional theory is that job dissatisfaction builds over
time and eventually becomes strong enough to motivate employees to search for better work opportunities
elsewhere. This is likely true to some extent, but it is
more likely that specific “shock events” quickly energize
employees to think about and engage in exit behaviour.
For example, the emotional reaction you experience to
an unfair management decision or a conflict episode with
a co-worker motivates you to look at job ads and speak
to friends about job opportunities where they work. This
begins the process of visualizing yourself working at
another company and psychologically withdrawing from
your current employer.58
Part Two
Individual Behaviour and Processes
• Voice. Voice is any attempt to change, rather than
escape from, the dissatisfying situation. Voice can be a
constructive response, such as recommending ways for
management to improve the situation, or it can be more
confrontational, such as filing formal grievances or forming a coalition to oppose a decision.59 In the extreme,
some employees might engage in counterproductive
behaviours to get attention and force changes in the
• Loyalty. In the original version of this model, loyalty
was only briefly mentioned as an outcome of dissatisfaction. Instead, the original model stated that loyalty
predicted whether people chose exit or voice (i.e.,
high loyalty resulted in voice; low loyalty produced
exit).60 More recent writers describe loyalty as an
outcome, but in various and somewhat unclear ways.
Generally, they suggest that “loyalists” are employees
who respond to dissatisfaction by patiently waiting—
some say they “suffer in silence”—for the problem to
work itself out or be resolved by others.61
• Neglect. Neglect includes reducing work effort, paying
less attention to quality, and increasing absenteeism and
lateness. It is a passive activity with negative consequences for the organization.
Which of the four EVLN alternatives do employees use?
It depends on the person and the situation.62 Voice is more
common or frequent among employees with higher extraversion and conscientiousness, likely because these personality
factors relate to a person’s assertiveness, dutifulness, and outgoing nature. Past experience also influences which EVLN
action is applied. Employees who were unsuccessful with
voice in the past are more likely to engage in exit or neglect
when experiencing job dissatisfaction in the future. Loyalty,
as it was intended in the original exit–voice–loyalty model,
is another important factor. Specifically, employees are more
likely to quit when they have low loyalty to the company,
and they are more likely to engage in voice when they have
high loyalty. An employee’s response to dissatisfaction also
depends on the situation. Employees are less likely to use
the exit option when there are few alternative job prospects,
for example. Dissatisfied employees are more likely to use
voice than the other options when they are aware that other
employees are dependent on them and when organizational
leaders encourage employees to discuss their concerns.63
What about job satisfaction and job performance? Is it true
or false that “a happy worker is a productive worker?” This
is one of the oldest debates in workplace attitudes, and one
that has flip-flopped over the years.64 In recent years, studies
have fairly consistently concluded that the “happy worker”
hypothesis is true, but only to some extent. In other words,
there is a moderately positive relationship between job satisfaction and performance.65
Why does job satisfaction affect employee performance
only “to some extent”? One reason is that general attitudes
(such as job satisfaction) don’t predict specific behaviours
very well. The EVLN model reveals that reduced performance (a form of neglect) is only one of four possible
responses to dissatisfaction. A second reason is that some
employees have little control over their performance because
their work effort is paced by work technology or interdependence with co-workers in the production process. An
assembly-line worker, for instance, installs a fixed number of
windshields each hour with about the same quality of installation whether they have high or low job satisfaction.
A third consideration is that job performance might cause
job satisfaction, rather than vice versa.66 Higher performers
tend to have higher satisfaction because they receive more
rewards and recognition than do low-performing employees.
The connection between job satisfaction and performance
isn’t stronger because many organizations do not reward
good performance very well.
Earls Restaurants Ltd. has survived and thrived for over
30 years in a highly competitive business. A key ingredient in the Vancouver-based company’s success is stated in
its motto: “Great guest experiences begin with great partner experiences.” Throughout the years, Earls’ founders
and leaders have embraced the idea that customers are more
satisfied with their dining experience when the cooks, servers, and other staff (all of whom are called partners at Earls)
have positive emotions and attitudes regarding their jobs and
Earls Restaurants maintains strong customer service by
applying the service profit chain model. This model, which
is diagrammed in Exhibit 4.5, proposes that job satisfaction
has a positive effect on customer service, which flows on to
shareholder financial returns. The process begins with workplace practices that increase or decrease job satisfaction.
Job satisfaction then influences whether employees
service profit chain model A
stay (employee retention)
theory explaining how
employees’ job satisfaction
as well as their motivation
influences company profitabiland behaviour on the job.
ity indirectly through service
Retention, motivation, and
quality, customer loyalty, and
behaviour affect service
related factors.
quality, which influences
Chapter Four
Workplace Emotions, Attitudes, and Stress 99
©Cathy Yeulet/iStockphoto/Getty Images
The Co-operators has the highest satisfaction ratings among automobile insurance customers in Ontario, Alberta, and
the Atlantic region. The Guelph, Ontario, company also has the most satisfied home insurance customers in Atlantic
Canada and Ontario, and second-most satisfied customers (after BCAA) in Western Canada. One key reason why The
Co-operators achieves such consistently favourable customer results is the service profit chain model; the company has
more satisfied customers by having more satisfied employees. In fact, over the past 16 years the firm has been named
annually as one of Canada’s Best Employers. “We believe an engaged team leads to happy employees, and happy
employees lead to happy customers,” says Co-operators CEO Rob Wesseling.*
* M. Nguyen, “Why People Still Matter to Canada’s Best Employers,” Canadian Business, November 8, 2018; “2019 Canada Auto Insurance Satisfaction
Study,” News Release (Toronto: J.D. Power Canada, February 14, 2019); “2019 Canada Home Insurance Satisfaction Study,” News Release (Toronto: J.D.
Power Canada, March 28, 2019).
the customer’s satisfaction, perceived value of the service,
and tendency to recommend the service to others (referrals).
These customer activities influence the company’s profitability and growth. The service profit chain model has strong
research support. However, the benefits of job satisfaction do
take considerable time to flow through to the organization’s
bottom line.68
Within the service profit chain model are two key explanations for why satisfied employees tend to produce happier
and more loyal customers.69 One explanation is that job satisfaction tends to put employees in a more positive mood,
and people in a good mood more naturally and frequently
display friendliness and positive emotions. When employees have good feelings, their display of positive emotions
Service Profit Chain Model
and behaviour
loyalty and
and growth
100 Part Two
Individual Behaviour and Processes
How committed are you to your school? You can discover your affective commitment as a student at
your school by completing this self-assessment in Connect.
“rubs off” on most (but not all) customers, so customers feel
happier and consequently form a positive evaluation of the
service experience (i.e., higher service quality). The effect
is also mutual; happy customers make employees happier,
which can lead to a virtuous cycle of positive emotions in the
service experience.
The second explanation is that satisfied employees are
less likely to quit their jobs, so they have more work experience (i.e., better knowledge and skills) to serve clients.
Lower turnover also enables customers to have the same
employees serve them on different occasions, providing
more consistent service. Some evidence indicates that customers build their loyalty to specific employees, not to the
organization, so keeping employee turnover low tends to
build customer loyalty.
Along with its significant effect on employee behaviour, job
satisfaction is an ethical issue that influences the organization’s reputation in the community. People spend a large
portion of their time working in organizations, and many
societies now expect companies to provide work environments that are safe and enjoyable. Indeed, employees in several countries closely monitor ratings of the best companies to
work for, an indication that employee satisfaction is a virtue
worth considerable goodwill to employers. The importance
of this reputation is apparent when an organization has low
job satisfaction. The company typically tries to hide this fact,
and when morale problems become public, corporate leaders
are usually quick to take steps to improve the situation.
Organizational Commitment
Organizational commitment—specifically affective organizational commitment—
represents the other half
affective organizational
(with job satisfaction) of
commitment An individual’s
emotional attachment to,
what some experts call
involvement in, and identifica“overall job attitude.”
tion with an organization.
Affective commitment is
the employee’s emotional
attachment to, involvement in, and identification with an
organization. It is a psychological bond whereby one chooses
to be dedicated to and responsible for the organization.
Furthermore, affective commitment is an autonomous form
of commitment; that is, the employee is motivated by internal strivings of self-concept and values alignment rather than
by external forces.70
Affective commitment differs from continuance
commitment, which is a calculative attachment to the organization. Continuance commitment occurs when the employee
faces significant social or
continuance commitment An
economic sacrifice if they
individual’s calculative attachwere to leave the company
ment to an organization.
(e.g., “I hate this place but
can’t afford to quit!”).71
This happens when quitting forfeits a large deferred financial bonus or risks weakening social bonds with friends at
work. Continuance commitment also occurs when people
have limited alternative employment opportunities (e.g., “I
dislike working here but there are no other jobs available”).
In each situation, continuance commitment is motivation to
remain with and participate in the organization due to external factors, whereas the motivation of affective commitment
originates internally from the person’s identity, bond, and
psychological attachment to the organization.
Affective and continuance commitment have a third sibling, called normative commitment, which refers to a felt
obligation or moral duty to the organization.72 Felt obligation
applies the norm of reciprocity—a natural human motivation to support, contribute,
norm of reciprocity A felt
and otherwise “pay back”
obligation and social expecthe organization because
tation of helping or otherwise
it has invested in and supgiving something of value to
ported the employee (see
someone who has already
Chapter 10). The sense of
helped or given something of
moral duty is the motivavalue to you.
tion to remain with and
contribute to the organization because it is the right thing to do as a member of the
organization. Normative commitment receives less attention
because it overlaps somewhat with affective commitment
and its meaning is somewhat ambiguous.
Affective commitment can be a significant competitive
advantage.73 Employees with a strong psychological bond
to the organization are less likely to quit their jobs and be
absent from work. They also have higher work motivation
and organizational citizenship, as well as somewhat higher
Chapter Four
job performance. Affective commitment also improves customer satisfaction because long-tenure employees have better
knowledge of work practices and clients like to do business
with the same employees. One concern is that employees
with very high loyalty tend to have high conformity, which
results in lower creativity. Another problem is that employees
with very high commitment are more motivated to engage in
illegal activity in defence of the organization. However, most
companies suffer from too little rather than too much affective commitment.
In contrast to the benefits of affective commitment,
employees with high levels of continuance commitment tend
to have lower performance and are less likely to engage in
organizational citizenship behaviours. Furthermore, unionized employees with high continuance commitment are
more likely to use formal grievances, whereas employees
with high affective commitment engage in more cooperative
problem solving when employee–employer relations sour.74
Although some level of financial connection may be necessary, employers should not rely on continuance commitment to retain staff. Instead, they should focus on winning
employees’ hearts through affective commitment.
There are almost as many ways to build and maintain affective commitment as there are topics in this textbook, but here
are the most frequently mentioned strategies in the literature:
• Justice and support. Affective commitment is higher in
organizations that support organizational justice, which
we discuss in the next chapter. Similarly, organizations
that support employee well-being tend to cultivate higher
levels of loyalty in return.75
• Shared values. The definition of affective commitment
refers to a person’s identification with the organization,
and that identification is highest when employees believe
their values are congruent with the organization’s dominant values. Employees also experience more positive
emotions when their personal values are aligned with
corporate values and actions, and these positive emotions
increase their motivation to stay with the organization.76
• Trust. Trust refers to positive expectations one person
has toward another person or group in situations involving risk.77 Trust means putting faith in others. It is also
a reciprocal activity: To receive trust, you must demonstrate trust. Employees identify with and feel obliged to
work for an organization
trust Positive expectations
only when they trust its
one person has toward
leaders. This explains
another person or group in
why layoffs are one of the
situations involving risk.
greatest blows to affective
Workplace Emotions, Attitudes, and Stress 101
commitment. By reducing job security, companies
reduce the trust employees have in their employer and
the employment relationship.78
• Organizational comprehension. Organizational comprehension refers to how well employees understand
the organization, including its strategic direction, social
dynamics, and physical layout.79 This awareness is a
necessary prerequisite to affective commitment because
it is difficult to identify with or feel loyal to something
that you don’t know very well. Furthermore, lack of
information produces uncertainty, and the resulting stress
can distance employees from that source of uncertainty
(i.e., the organization). The practical implication here is
to ensure that employees develop a reasonably clear and
complete mental model of the organization. This occurs
by giving staff information and opportunities to keep
up-to-date about organizational events, to interact with
co-workers, to discover what goes on in different parts
of the organization, and to learn about the organization’s
history and future plans.80
• Employee involvement. Employee involvement increases
affective commitment by strengthening the employee’s
psychological ownership and social identity with the
organization.81 Employees feel that they are an integral
part of the organization when they participate in decisions that guide the organization’s future (see Chapter 7).
Employee involvement also builds loyalty because giving
this power is a demonstration of the company’s trust in
its employees.
Organizational commitment and job satisfaction represent
two of the most often studied and discussed attitudes in the
workplace. Each is linked to emotional episodes and cognitive judgments about the workplace and one’s relationship
with the company. Emotions also play an important role in
another concept that is on everyone’s mind these days: stress.
The final section of this chapter provides an overview of
work-related stress and how it can be managed.
Work-Related Stress and Its
When asked if they often feel stressed by their work, most
employees these days will answer with an emphatic Yes! Not
only do most people understand the concept; they feel they
have plenty of personal
stress An adaptive response
experience with it. Stress
to a situation that is perceived
is most often described as
as challenging or threatening
an adaptive response to a
to the person’s well-being.
situation that is perceived
102 Part Two
Individual Behaviour and Processes
How stressed are you? You can discover your perceived general level of stress over the past month
by completing this self-assessment in Connect.
Stressed Out, Burnt-Out!*
of National Health Service employees
in the U.K. report feeling unwell as a result of
work-related stress over the previous year.
of 1,005 Canadian
employees surveyed say they are
more stressed now from work than
they were five years ago.
of 151,000 adults
interviewed across 142 countries
said they had experienced significant
stress the previous day.
of 13,200 adults representative
of the population in 22 countries (including
Canada) say their work-related stress is
of more than 100,000 Canadian
adults (18-64 years) surveyed say that most days
in their life are quite a bit or extremely stressful.
©donskarpo/Getty Images
* Statistics Canada, “Perceived Life Stress, by Age Group,” Health Characteristics, Annual Estimates (Ottawa: Statistics Canada, June 26, 2018), https://doi.
org/10.25318/1310009601-eng.; “Morneau Shepell Finds Increase in Workplace and Personal Stress, While Sense of Stigma Declines,” News Release (Toronto:
Morneau Shepell, January 29, 2019); “NHS Staff Survey 2018: National Results Briefing” (London: National Health Service, February 26, 2019); “2019 CIGNA 360
Well-Being Survey: Well and Beyond” (Bloomfield, CT: CIGNA, March 26, 2019); “2019 Global Emotions Report” (Washington, D.C.: Gallup, April 18, 2019).
as challenging or threatening to a person’s well-being.82 It
is a physiological and psychological condition that prepares
us to adapt to hostile or noxious environmental conditions.
Our heart rate increases, muscles tighten, breathing speeds
up, and perspiration increases. Our body also moves more
blood to the brain, releases adrenaline and other hormones,
fuels the system by releasing more glucose and fatty acids,
activates systems that sharpen our senses, and conserves
resources by suppressing our immune response. One school
of thought suggests that stress is a negative evaluation of
the external environment. However, critics of this cognitive
appraisal perspective point out that stress is more accurately
described as an emotional experience, which may occur
before or after a conscious evaluation of the situation.83
Whether stress is a complex emotion or a cognitive
evaluation of the environment, it has become a pervasive
experience in the daily lives of most people. Stress is typically described as a negative experience. This is known as
distress—the degree of physiological, psychological, and
behavioural deviation from healthy functioning. However,
some level of stress—called eustress—is a necessary part
of life because it activates and motivates people to achieve
goals, change their environments, and succeed in life’s challenges.84 Our focus is on the causes and management of
distress, because it has become a chronic problem in many
The word stress was first used more than 500 years ago to
describe the human response to harsh environmental conditions. However, it wasn’t until the 1930s that Canadian
researcher Hans Selye (often described as the father of stress
research) first documented the stress experience, called
general adaptation syndrome. Selye determined (initially
by studying rats) that peogeneral adaptation synple have a fairly consistent
drome A model of the stress
and automatic physiologiexperience, consisting of
cal response to stressful sitthree stages: alarm reaction,
uations, which helps them
resistance, and exhaustion.
to cope with environmental
Chapter Four
Workplace Emotions, Attitudes, and Stress 103
General Adaptation Syndrome
Stage 1
to Cope
Alarm reaction
Stage 2
Stage 3
The general adaptation syndrome consists of the three
stages shown in Exhibit 4.6. The alarm reaction stage
occurs when a threat or challenge activates the physiological stress responses that we described a few paragraphs
ago. The individual’s energy level and coping effectiveness
decrease in response to the initial shock. The second stage,
resistance, activates various biochemical, psychological,
and behavioural mechanisms that give the individual more
energy and engage coping mechanisms to overcome or
remove the source of stress. To focus energy on the source of
the stress, the body reduces resources to the immune system
during this stage. This explains why people are more likely
to catch a cold or some other illness when they experience
prolonged stress. People have a limited resistance capacity,
and if the source of stress persists, the individual will eventually move into the third stage, exhaustion. Most of us are
able to remove the source of stress or remove ourselves from
that source before becoming too exhausted. However, people
who frequently reach exhaustion have increased risk of longterm physiological (notably, brain) and psychological (mental health) damage.86
commitment. Furthermore, various behavioural outcomes
have been linked to high or persistent stress, including lower
job performance, poor decision making, and increased workplace accidents and aggressive behaviour. Most people react
to stress through “fight or flight,” so, as a form of flight,
increased absenteeism is another outcome of stress.88
One particular stress consequence, called job burnout,
occurs when people experience emotional exhaustion, cynicism, and reduced feelings of personal accomplishment.89
Emotional exhaustion, the first stage, is characterized by
tiredness, a lack of energy, and a feeling that one’s emotional
resources are depleted. This is followed by cynicism (also
called depersonalization), which is an indifferent attitude
toward work, emotional detachment from clients, a cynical
view of the organization, and a tendency to strictly follow
rules and regulations rather than adapt to the needs of others.
The final stage of burnout, called reduced personal accomplishment, entails feelings of diminished confidence in one’s
ability to perform the job well. In such situations, employees develop a sense of learned helplessness as they no longer
believe that their efforts make a difference.
Stress takes its toll on the human body. Many people experience tension headaches, muscle pain, and related problems
mainly due to muscle contractions from the stress response.
High stress levels also contribute to cardiovascular disease,
including heart attacks and strokes, and may be associated
with some forms of cancer. One major review estimated that
more than 100,000 deaths annually and as much as 8 percent
of health care costs in the United States are due to the consequences of work-related stress. Stress also produces
various psychological consequences, such as job dissatisfaction, moodiness, depression, and lower organizational
Before identifying ways to manage work-related stress, we
must first understand its causes, known as stressors. Stressors
include any environmental conditions that place a physical or
emotional demand on a person.90 There are numerous stressors in the workplace and
stressors Environmental conin life in general. We will
ditions that place a physical
briefly describe four of the
or emotional demand on the
most common work-related
stressors: organizational
constraints, interpersonal
conflict, work overload, and low task control.91
104 Part Two
Individual Behaviour and Processes
Organizational Constraints
Stress research has identified organizational constraints as
one of the most pervasive causes of workplace stress.92 This
stressor includes lack of equipment, supplies, budget funding, co-worker support, information, and other resources
necessary to complete the required work. Most employees
experience stress because these constraints interfere with
task performance, which indirectly threatens their rewards,
status, and job security. Organizational constraints refer to
situational factors, which comprise one of the four direct
predictors of individual behaviour and performance (see the
MARS model in Chapter 1. It is the only direct influence
on individual performance that is beyond the employee’s
immediate control. This lack of control is a powerful stressor
because it threatens the individual’s fundamental drive to
influence their external environment.
Interpersonal Conflict
Organizations consist of groups of people working interdependently toward some purpose. But even though they
share common organizational goals, employees experience
conflict because they frequently disagree with each other
regarding how to achieve those goals as well as how the work
and resources should be distributed along that journey. As
we will learn in Chapter 11, dysfunctional conflict can easily
flare up and, left unchecked, escalate to a level that produces
considerable stress and counterproductive work behaviours.
In organizational settings, most interpersonal conflict is
©Rstelmach | Dreamstime.com
Harassment is much too common in the workplace, and the City of Edmonton is no exception. Almost one-quarter
(23.8 percent) of the municipality’s employees say they have been harassed at work within the previous year. For
example, staff in the accounts payable office complained that their manager harassed and bullied them for years. When
they tried in vain to warn about serious flaws in Edmonton’s new invoice payment system, the manager blamed the eight
employees for not adequately performing their jobs. He accused them of lacking the experience and credentials to judge
the new system.
An external audit eventually confirmed the employees’ worries: the new payment system had systemic errors. The
accounts payable office employees filed a harassment complaint against their manager, who was eventually fired.
Unfortunately, the staff members had suffered severe stress; several had taken sick leave to recover. “There are eight
members that are very hurt,” said accounts payable office co-ordinator Darlene Woodham in a presentation to Edmonton
City council. “There are people who are seriously sick because of being harassed. They can’t function.”*
* E. Stolte, “‘Very Hurt’: Years of Harassment Finally Led to Managerial Change | Edmonton Journal,” Edmonton Journal, July 5, 2018;“2018 Employee
Engagement & Diversity Survey Results” (City of Edmonton, January 15, 2019); E. Stolte, “Audit into City Payment System Illustrates How Workplace Culture
Can Hit Bottom Line,” Edmonton Journal, January 25, 2019.
Chapter Four
Workplace Emotions, Attitudes, and Stress 105
Are you a workaholic? You can discover the extent to which you are a workaholic by completing this
self-assessment in Connect.
caused by structural sources, such as ambiguous rules, lack
of resources, and conflicting goals between employees or
departments. However, one form of interpersonal conflict
that has become an increasing concern is workplace harassment, including workplace bullying, sexual harassment, and
other forms of incivility and mistreatment by co-workers,
managers, or customers.93
Work Overload
“We just keep rushing along in a confused state of never having time to do the things that seem to be pressing upon us.”
Sound familiar? Most Canadians have probably had a similar
thought in the past year. But although this comment comes
from Canada, it wasn’t written in the past year or even in
the past decade. It appeared in an article called “Let’s Slow
Down!” in a Royal Bank of Canada newsletter in 1949!94
The fact is, people have been struggling for more than half
a century with work overload. Employees are expected (or
believe they are expected) to complete more work with more
effort than they can provide within the allotted time.95
Work overload is evident when employees consume more
of their personal time to get the job done. Technology and
globalization also contribute to work overload because they
tether employees to work for more hours of the day. People
increasingly work with co-workers in distant time zones,
and their communication habits of being constantly “on”
make it difficult to separate work from personal life. Some
employees contribute to work overload by adopting an “ideal
worker norm” in which they expect themselves and others
to work longer hours. For many, toiling away far beyond the
normal workweek is a badge of honour, a symbol of their
superhuman capacity to perform above others. For example,
39 percent of Millennial employees in one recent large-scale
survey admitted that they work long hours and have a 24/7
schedule so they look like a “work martyr” to their boss.96
Low Task Control
Workplace stress is higher when employees lack control
over how and when they perform their tasks as well as over
the pace of work activity. Work is potentially more stressful
when it is paced by a machine, involves monitoring equipment, or when the work schedule is controlled by someone else. Low task control is a stressor because employees
face high workloads without the ability to adjust the pace
of the load to their own energy, attention span, and other
resources. Furthermore, the degree to which low task control is a stressor increases with the burden of responsibility
the employee must carry.97 Assembly-line workers have low
task control, but their stress can be fairly low if their level
of responsibility is also low. In contrast, sports coaches are
under immense pressure to win games (high responsibility),
yet they have little control over what happens on the playing
field (low task control).
Two employees exposed to the same stressor often experience different levels of stress. One reason is that a person’s response to stressors varies with their physical health.
Regular exercise and a healthy lifestyle produce a larger
store of energy to cope with stress. A second reason is that
people use different strategies to cope with the stressor.98
Some try to remove the stressor or to minimize its presence.
Others seek out support from co-workers and friends or try
to reframe the stressor in a more positive light. Some coping strategies work better for specific stressors and some are
better across all stressors.99 Those who prefer a less effective
coping mechanism in a particular situation would experience
more stress in response to that situation.
Personality is a third reason why people experience different levels of stress when faced with the same stressor.100
Individuals with low neuroticism (high emotional stability)
usually experience lower stress levels because, by definition,
they are less prone to anxiety, depression, and other negative
emotions. Extraverts also tend to experience lower stress than
do introverts, likely because extraversion includes a degree of
positive thinking and extraverts interact with others, which
helps buffer the effect of stressors. Those with a positive
self-concept—high self-esteem, self-efficacy, and internal
locus of control (see Chapter 3)—feel more confident and
in control when faced with a stressor. In other words, they
tend to have a stronger sense of optimism.101 Stress also tends
to be higher among those who suffer from workaholism.
Workaholics have an uncontrollable work motivation, constantly think about work, and have low work enjoyment.102
Many people deny the existence of their stress until it has
serious outcomes. This avoidance strategy amplifies the
stress, because the failure to cope with stress becomes
another stressor on top of the one that created the stress in
the first place. To prevent this vicious cycle, employers and
106 Part Two
Individual Behaviour and Processes
Global Connections 4.3
Japanese employees are chronically overworked and
sleep deprived. Using fitness trackers, one study found
that Japanese men and women sleep only 6 hours and
35 minutes each day, on average, which is the lowest
among 28 countries studied.
Crazy Inc. hopes to reduce the Japanese penchant
for overwork by motivating people to sleep longer. The
Tokyo-based upscale wedding organizer awards points
to employees who sleep at least six hours every night
for at least five days each week. Employee sleep patterns are tracked by an app developed by a mattress
manufacturer. The points, which are exchanged for
food in the company cafeteria, can add up to more than
$500 per year.
©david pearson/Alamy Stock Photo
* M. Katanuma, “The Company That Pays Its Employees to Get a Full Night’s Sleep,” Bloomberg, October 21, 2018; L. Lewis, “Japan Wakes up to Sleep
Shortage Problems,” Financial Times, November 20, 2018; J. McCurry, “Snoozing on the Job: Japanese Firms Tackle Epidemic of Sleeplessness,” The
Guardian, January 8, 2019.
employees need to apply one or more of the stress management strategies described next: remove the stressor, withdraw from the stressor, change stress perceptions, control
stress consequences, and receive social support.103
introduced policies that prohibit managers and employees
from communicating work-related issues during nonwork
Remove the Stressor
Removing the stressor may be the ideal solution, but it isn’t
feasible in every situation. Another strategy is to permanently or temporarily remove employees from the stressor.
Permanent withdrawal occurs when employees are transferred to jobs that are more compatible with their abilities
and values. Temporarily withdrawing from stressors is the
most frequent way that employees manage stress. Vacations
and holidays are important opportunities for employees to
recover from stress and re-energize for future challenges.
A small number of companies offer paid or unpaid sabbaticals.105 Many firms also provide innovative ways for
employees to withdraw from stressful work throughout the
day, such as games rooms, ice cream cart breaks, nap rooms,
and cafeterias that include live piano recitals.
There are many ways to remove the stressor, but some of
the more common actions involve assigning employees to
jobs that match their skills and preferences, reducing excessive workplace noise, having a complaint system and taking
corrective action against harassment, and giving employees
more control over the work process. Another important way
that companies can remove stressors is through work–life
integration initiatives (see Chapter 1). For example, personal leave benefits, such as maternity and paternity leave,
temporarily offer employees paid nonwork time to
work–life integration The
manage special circumextent to which people are
stances. Remote work
effectively engaged in their
potentially improves work–
various work and nonwork
roles and have a low degree
life integration by reducing
of role conflict across those
or eliminating commuting
life domains.
time and increasing flexibility to perform nonwork obligations (such as picking up the kids from school).
Some companies and at least one government (France) have
Withdraw from the Stressor
Change Stress Perceptions
How much stress employees experience depends on how they
perceive the stressor.106 Consequently, another way to manage stress is by coaching employees to improve their selfconcept, personal goal setting, and self-reinforcement practices. Job challenges are perceived as less threatening when
Chapter Four
Workplace Emotions, Attitudes, and Stress 107
How do you cope with stressful situations? You can discover your preferences among four coping
strategies by completing this self-assessment in Connect.
employees develop these self-views and self-management
activities. In addition, research suggests that some (but not
all) forms of humour can improve optimism and create positive emotions by taking some psychological weight off a
stressful situation.107
programs inform employees about the benefits of better nutrition and fitness, regular sleep, and other good health habits.
Finally, many large employers offer employee assistance
programs (EAPs)—counselling services that help employees
resolve marital, financial, or work-related troubles.
Control Stress Consequences
Receive Social Support
Keeping physically fit and maintaining a healthy lifestyle
are effective stress management strategies because they control stress consequences. Good physical fitness reduces the
adverse physiological consequences of stress by helping
employees moderate their breathing and heart rate, muscle
tension, and stomach acidity. The key variable here is physical fitness, not exercise. Exercise leads to physical fitness, but
research suggests that exercise does not reduce stress symptoms among people who are not yet physically fit.108 Various
forms of meditation can potentially reduce anxiety and other
symptoms of stress, but their effect on blood pressure and
other physiological symptoms is minimal.109 Wellness programs can help control the consequences of stress. These
Social support occurs when co-workers, supervisors, family
members, friends, and others provide emotional and/or informational support to buffer an individual’s stress experience.
Social support potentially improves the person’s optimism
and self-confidence, because support makes people feel valued and worthy. Social support also provides information to
help the person interpret, comprehend, and possibly remove
the stressor. For instance, to reduce a new employee’s stress,
co-workers could describe ways to handle difficult customers. Seeking social support is called a “tend and befriend”
response to stress, and research suggests that women often
take this route rather than the “fight or flight” response mentioned earlier.110
Chapter Summary
Explain how emotions and cognition (conscious reasoning)
influence attitudes and behaviour.
Emotions are physiological, behavioural, and psychological episodes experienced toward an object, person, or event that create a
state of readiness. Emotions differ from attitudes, which represent
a cluster of beliefs, feelings, and behavioural intentions toward a
person, object, or event. Beliefs are a person’s established perceptions about the attitude object. Feelings are positive or negative
evaluations of the attitude object. Behavioural intentions represent a motivation to engage in a particular behaviour toward the
Attitudes have traditionally been described as a purely rational
process in which beliefs predict feelings, which predict behavioural
intentions, which predict behaviour. We now know that emotions
have an influence on behaviour that is equal to or greater than that
of cognition. This dual process is apparent when we internally experience a conflict between what logically seems good or bad and
what we emotionally feel is good or bad in a situation. Emotions
also affect behaviour directly. Behaviour sometimes influences our
subsequent attitudes through cognitive dissonance.
Discuss the dynamics of emotional labour and the role of
emotional intelligence in the workplace.
Emotional labour consists of the effort, planning, and control
needed to express organizationally desired emotions during interpersonal transactions. It is more common in jobs requiring a variety of emotions and more intense emotions, as well as in jobs in
which interactions with clients are frequent and long in duration.
Employees experience stress, job dissatisfaction, and low job performance when the emotions they are required to display differ
markedly from the emotions they actually experience at that time.
The extent to which employees are expected to hide their true emotions varies considerably across cultures.
Employees sometimes fulfil their emotional labour obligations
through surface acting—they consciously display behaviours that
represent the expected emotions even though their actual emotions
are different. A second strategy is deep acting, whereby employees actively change their true emotions so they are similar to the
required emotions. The five ways to regulate emotions are to:
(a) change the situation, (b) modify the situation, (c) suppress or
amplify emotions, (d) shift attention, and (e) reframe the situation.
108 Part Two
Individual Behaviour and Processes
Emotional intelligence is the ability to perceive and express
emotion, assimilate emotion in thought, understand and reason with
emotion, and regulate emotion in oneself and others. This concept
includes four components arranged in a hierarchy (from lowest to
highest): awareness of one’s own emotions, management of one’s
own emotions, awareness of others’ emotions, and management of
others’ emotions. Emotional intelligence can be learned to some
Summarize the consequences of job dissatisfaction, as well as
strategies to increase organizational (affective) commitment.
Job satisfaction represents a person’s evaluation of their job and
work context. Four types of job dissatisfaction consequences are
quitting or otherwise getting away from the dissatisfying situation
(exit), attempting to change the dissatisfying situation (voice),
patiently waiting for the problem to sort itself out (loyalty), and
reducing work effort and performance (neglect). Job satisfaction
has a moderate relationship with job performance and with customer satisfaction. Affective organizational commitment (loyalty)
is the employee’s emotional attachment to, identification with,
and involvement in a particular organization. This contrasts with
continuance commitment, which is a calculative bond with the
organization. Normative commitment—a felt obligation or moral
duty to the organization—is a third form of organizational commitment. Companies build loyalty through justice and support,
shared values, trust, organizational comprehension, and employee
Describe the stress experience and review four major stressors.
Stress is an adaptive response to a situation that is perceived as
challenging or threatening to a person’s well-being. The stress
experience, called general adaptation syndrome, involves moving
through three stages: alarm, resistance, and exhaustion. Stressors
are the causes of stress and include any environmental conditions
that place a physical or emotional demand on a person. Four of the
most common workplace stressors are organizational constraints,
interpersonal conflict, work overload, and low task control.
Identify five ways to manage workplace stress.
Many interventions are available to manage work-related stress,
including removing the stressor, withdrawing from the stressor,
changing stress perceptions, controlling stress consequences, and
receiving social support.
Key Terms
affective organizational commitment
cognitive dissonance
continuance commitment
emotional intelligence (EI)
emotional labour
exit-voice-loyalty-neglect (EVLN) model
general adaptation syndrome
job satisfaction
norm of reciprocity
service profit chain model
work–life integration
Critical Thinking Questions
1. It has almost become a mandatory practice for companies to ensure that employees have fun at work. Many
workplaces now have fully-stocked lounges, games
rooms, funky painted walls, and regular social events.
A few even have a slide to travel down to the next floor.
However, some experts warn that imposing fun at work
can have negative consequences. “Once the idea of fun
is formally institutionalized from above, it can lead to
employees becoming resentful,” warns one critic. “They
feel patronized and condescended, and it breeds anger
and frustration.” Apply the model of emotions, attitudes, and behaviour to explain how fun activities might
improve customer satisfaction, as well as how they might
result in poorer customer satisfaction.
2. Studies suggest that university and college instructors
are frequently required to engage in emotional labour.
Identify the situations in which emotional labour is
required for this job. In your opinion, is emotional labour
more troublesome for college instructors or for call centre staff working at an emergency service?
3. Recall situations where you had to regulate your emotions. For example, think of times when you wanted to
feel more serious than you would otherwise, or experience more happiness for someone at a time when events
caused your emotions to be less positive. Which of the
five emotion regulation strategies did you apply? Why
were those strategies chosen? How difficult was it to
actually change your emotions?
Chapter Four
4. “Emotional intelligence is more important than cognitive
intelligence in influencing an individual’s success.” Do
you agree or disagree with this statement? Support your
5. “Happy employees lead to happy customers.” Explain
why this statement tends to be true and identify conditions in which it might not be true.
6. In this chapter, we highlighted work-related stressors, including organizational constraints (e.g., lack of
resources), interpersonal conflict (including harassment),
work overload, and low task control. Of course, there are
many nonwork-related stressors that increasingly come
into play. Discuss these and their impact on the work
Workplace Emotions, Attitudes, and Stress 109
7. Two college graduates recently joined the same major
newspaper as journalists. Both work long hours and
have tight deadlines for completing their stories. They
are under constant pressure to scout out new leads and
be the first to report new controversies. One journalist is
increasingly fatigued and despondent and has taken several days of sick leave. The other is getting the work done
and seems to enjoy the challenges. Use your knowledge
of stress to explain why these two journalists are reacting
differently to their jobs.
8. A senior official of a labour union stated: “All stress
management does is help people cope with poor management. [Employers] should really be into stress reduction.”
Discuss the validity of this statement.
Case Study:
by Rosemary Maellaro, University of Dallas
Diana Gillen had an uneasy feeling of apprehension as she
arrived at the Cobb Street Grille corporate offices. Today she
was meeting with her supervisor, Julie Spencer, and regional
director, Tom Miner, to learn the outcome of her promotion
interview for the district manager position. Diana had been
employed by this casual dining restaurant chain for 12 years
and had worked her way up from server to general manager.
Based on her track record, she was the obvious choice for
the promotion; and her friends assured her that the interview
process was merely a formality. Diana was still anxious,
though, and feared that the news might not be positive. She
knew she was more than qualified for the job, but that didn’t
guarantee anything these days.
Nine months ago, when Diana interviewed for the last district manager opening, she thought her selection for the job
was inevitable. She was shocked when that didn’t happen.
Diana was so upset about not getting promoted then that she
initially decided not to apply for the current opening. She
eventually changed her mind—after all, the company had
just named her Restaurant Manager of the Year and entrusted
her with managing its flagship location. Diana thought her
chances had to be really good this time.
A multi-unit management position was a desirable move
up for any general manager and was a goal to which Diana
had aspired since she began working in the industry. When
she had not been promoted the last time, Julie explained
that her people skills needed to improve. But Diana knew
that explanation had little to do with why she hadn’t gotten
the job—the real reason was corporate politics. She heard
that the person they hired was some superstar from the outside—a district manager from another restaurant company
who supposedly had strong multi-unit management experience and a proven track record of developing restaurant
managers. Despite what she was told, she was convinced that
Tom, her regional manager, had been unduly pressured to
hire this person, who had been referred by the CEO.
The decision to hire the outsider may have impressed
the CEO, but it enraged Diana. With her successful track
record as a restaurant manager for the Cobb Street Grille,
she was much more capable, in her opinion, of overseeing
multiple units than someone who was new to the operation.
Besides, district managers had always been promoted internally among the restaurant managers and she was unofficially designated as the next person to move up to a district
position. Tom had hired the outside candidate as a political
manoeuvre to put himself in a good light with management,
even though it meant overlooking a loyal employee like her
in the process. Diana had no patience with people who made
business decisions for the wrong reasons. She worked very
hard to avoid politics—and it especially irritated her when
the political actions of others negatively impacted on her.
Diana was ready to be a district manager nine months ago,
and thought she was even more qualified today—provided
the decision was based on performance. She ran a tight ship,
managing her restaurant completely by the book. She meticulously adhered to policies and procedures and rigorously
110 Part Two
Individual Behaviour and Processes
controlled expenses. Her sales were growing, in spite of new
competition in the market, and she received relatively few
customer complaints. The only number that was a little out
of line was the higher turnover among her staff.
Diana was not too concerned about the increasing number
of terminations, however; there was a perfectly logical explanation for this. It was because she had high standards—for
herself and her employees. Any employee who delivered less
than 110 percent at all times would be better off finding a
job somewhere else. Diana didn’t think she should bend the
rules for anyone, for whatever reason. A few months ago, for
example, she had to fire three otherwise good employees who
decided to try a new customer service tactic—a so-called
innovation they dreamed up—rather than complying with
the established process. As the general manager, it was her
responsibility to make sure that the restaurant was managed
strictly in accordance with the operations manual and she
could not allow deviations. This by-the-book approach to
managing had served her well for many years. It had got her
promoted in the past and she was not about to jinx that now.
Losing a few employees now and then— particularly those
who had difficulty following the rules—was simply the cost
of doing business.
During a recent visit, Julie suggested that Diana might try
creating a friendlier work environment because she seemed
aloof and interacted with employees somewhat mechanically. Julie even told her that she overheard employees refer
to Diana as the “Ice Maiden” behind her back. Diana was
surprised that Julie brought this up because her boss rarely
criticized her. They had an unspoken agreement: since Diana
was so technically competent and always met her financial
targets, Julie didn’t need to give her much input. Diana was
happy to be left alone to run her restaurant without needless
At any rate, Diana rarely paid attention to what employees
said about her. She wasn’t about to let something as childish
as a silly name cause her to modify a successful management
strategy. What’s more, even though she had recently lost more
than the average number of employees due to “personality
differences” or “miscommunications” over her directives,
her superiors did not seem to mind when she consistently
delivered strong bottom-line results every month.
As she waited in the conference room for the others,
Diana worried that she was not going to get the promotion.
Julie had sounded different in the voicemail message she left
to inform her about this meeting, but Diana couldn’t put her
finger on exactly what it was. She would be very angry if she
was passed over again and wondered what excuse they would
have this time. Then her mind wandered to how her employees would respond to her if she did not get the promotion.
They all knew how much she wanted the job and she cringed
to think how embarrassed she would be if she didn’t get it.
Her eyes began to mist over at the sheer thought of having to
face them if she was not promoted today.
Julie and Tom entered the room and the meeting was
underway. They told Diana, as kindly as they could, that she
would not be promoted at this time; one of her colleagues
would become the new district manager. She was incredulous. The individual who got promoted had been with the
company only three years—and Diana had trained her! She
tried to comprehend how this happened, but it did not make
sense. Before any further explanation could be offered, she
burst into tears and left the room. As she tried in vain to
regain her composure, Diana was overcome with crushing
Discussion Questions
1. Apply your knowledge of the four emotional intelligence
dimensions to discuss the likely reasons why Diana
wasn’t offered a promotion.
2. What skills does Diana need to develop to be promotable
in the future? What can the company do to support her
developmental efforts?
©Rosemary Maellaro
Case Study:
by Steven L. McShane, University of Newcastle (Australia)
Professor Suzanne Baxter was preparing for her first class
of the semester when Shaun O’Neill knocked lightly on
the open door and announced himself: “Hi, Professor, I
don’t suppose you remember me?” Professor Baxter had
large classes, but she did remember that Shaun had been
a student in her organizational behaviour class a few years
earlier. Shaun had decided to work in the oil industry for a
couple of years before returning to school to complete his
“Welcome back!” Baxter said as she beckoned him into
the office. “I heard you were working on an oil rig in the
United Kingdom. How was it?”
Chapter Four
“Well, professor,” Shaun began, “I had worked two summers in the Texan oil fields and my family’s from Ireland, so
I hoped to get a job on the LINK650. It’s that new WestOil
drilling rig that arrived with so much fanfare in the North
Sea fields a few years ago. The LINK650 was built by LINK
Inc. in Texas. A standard practice in this industry is for the
rig manufacturer to manage day-to-day rig operations, so
employees on the LINK650 are managed completely by
LINK managers with no involvement from WestOil. We
all know that drilling rig jobs are dangerous, but they pay
well and offer generous time off. A local newspaper there
said that nearly one thousand people lined up to complete
job applications for the 50 nontechnical positions available. I
was lucky enough to get one of those jobs.
“Everyone hired on the LINK650 was enthusiastic and
proud. We were among the chosen few and were really
pumped up about working on a new rig that had received
so much media attention. I was quite impressed with the
recruiters—so were several other hires—because they really
seemed to be concerned about our welfare out on the platform. I later discovered that the recruiters came from a consulting firm that specializes in hiring people. Come to think
of it, we didn’t meet a single LINK manager during that
process. Maybe things would have been different if some of
those LINK supervisors had interviewed us.
“Working on LINK650 was a real shock, even though
most of us had some experience working in the oil fields. I’d
say that not one of the 50 nontechnical people hired was quite
prepared for the brutal jobs on the oil rig. We did the dirtiest
jobs in the biting cold winds of the North Sea. Still, during
the first few months, most of us wanted to show the company
that we were dedicated to getting the job done. A couple of
the new hires quit within a few weeks, but most of the people
hired with me really got along well—you know, just like the
ideas you mentioned in class. We formed a special bond that
helped us through the bad weather and gruelling work.
“The LINK650 supervisors were another matter. They
were mean taskmasters who had worked for many years on
oil rigs in the Gulf of Mexico or North Sea. They seemed
to relish the idea of treating their employees the same way
they had been treated before becoming managers. We put
up with their abuse for the first few months, but things got
worse when the LINK650 was shut down twice to correct
mechanical problems. These setbacks embarrassed LINK’s
management and they put more pressure on the supervisors
to get us back on schedule.
“The supervisors started to ignore equipment problems
and pushed us to get jobs done more quickly without regard
to safety procedures. They routinely shouted obscenities at
employees in front of others. A couple of my workmates
were fired and a couple of others quit their jobs. I almost lost
Workplace Emotions, Attitudes, and Stress 111
my job one day just because my boss thought I was deliberately working slowly. He didn’t realize—or care—that
the fittings I was connecting were damaged. Several people
started finding ways to avoid the supervisors and get as little
work done as possible. Many of my co-workers developed
back problems. We jokingly called it the ‘rigger’s backache’
because some employees faked their ailment to leave the rig
with paid sick leave.
“Along with having lousy supervisors, we were always
kept in the dark about the problems on the rig. Supervisors
said that they didn’t know anything, which was partly true,
but they said we shouldn’t be so interested in things that
didn’t concern us. But the rig’s problems, as well as its future
contract work, were a major concern to crew members who
weren’t ready to quit. Their job security depended on the
rig’s production levels and whether WestOil would sign contracts to drill new holes. Given the rig’s problems, most of us
were concerned that we would be laid off at any time.
“Everything came to a head when Bob MacKenzie was
killed because someone secured a hoist improperly. Not sure
if it was mentioned in the papers here, but it was big news
around this time last year. A government inquiry concluded
that the person responsible wasn’t properly trained and that
employees were being pushed to finish jobs without safety
precautions. Anyway, while the inquiry was going on, several employees decided to unionize the rig. It wasn’t long
before most employees on LINK650 had signed union cards.
That really shocked LINK’s management and the entire oil
industry because it was, I think, just the second time that a
rig had ever been unionized there.
“Since then, management has been doing everything in
its power to get rid of the union. It sent a ‘safety officer’ to
the rig, although we eventually realized that he was a consultant the company hired to undermine union support. Several
managers were sent to special seminars on how to manage a
unionized workforce, although one of the topics was how to
break the union.
“So you see, professor, I joined LINK as an enthusiastic
employee and quit last month with no desire to lift a finger
for them. It really bothers me, because I was always told to
do your best, no matter how tough the situation. It’s been
quite an experience.”
Discussion Questions
1. Identify the various ways that employees expressed their
job dissatisfaction on the LINK650.
2. Shaun O’Neill’s commitment to the LINK organization
dwindled over his two years of employment. Discuss the
factors that affected his organizational commitment.
© Copyright. Steven L. McShane. This case is based on actual events, although names and some information have been changed.
112 Part Two
Individual Behaviour and Processes
Team Exercise:
Purpose This exercise is designed to help you understand
the jobs in which people tend to experience higher or lower
degrees of emotional labour.
Step 1: Individually rank-order the extent that the jobs listed
below require emotional labour. In other words, assign a “1”
to the job you believe requires the most effort, planning, and
control to express organizationally desired emotions during
interpersonal transactions. Assign a “10” to the job you
believe requires the least amount of emotional labour. Mark
your rankings in column 1.
Step 2: The instructor will form teams of four or five members and each team will rank-order the items on the basis
of consensus (not simply averaging the individual rankings).
These results are placed in column 2.
Step 3: The instructor will provide expert ranking information. This information should be written in column 3. Then
students calculate the differences in columns 4 and 5.
Step 4: The class will compare the results and discuss the
features of jobs with high emotional labour.
Occupational Emotional Labour Scoring Sheet
(1) Individual
(2) Team
(3) Expert
(4) Absolute
difference of 1
and 3
(5) Absolute
difference of 2
and 3
Your score
Team score
Dental hygienist
Insurance adjuster
Postal clerk
Registered nurse
Social worker
Television announcer
(The lower the score, the better.)
Chapter Four
Workplace Emotions, Attitudes, and Stress 113
Self-Assessments for Chapter 4
What is your emotional personality?
Emotions are influenced by the situation, but also by the individual’s own personality.
In particular, people tend to have a dispositional mood, that is, the level and valence of
emotion that they naturally experience due to their personality. This self-assessment
estimates your emotional trait tendencies.
How well do you recognize and regulate
Emotional intelligence is an important concept that potentially enables us to be more
effective with others in the workplace and other social settings. Emotional intelligence
is best measured as an ability test. However, you can estimate your level of emotional
intelligence to some extent by reflecting on events that required your awareness and
management of emotions. This instrument assesses your self-perceived emotional
intelligence on the four dimensions.
How committed are you to your school?
Organizational (affective) commitment refers to an individual’s emotional attachment
to, involvement in, and identification with an organization. It is mostly discussed
in this book as an employee’s attitude toward the company where he or she works.
But affective commitment is also relevant to a student’s attitude toward the college
or university where he or she is taking courses. This self-assessment estimates your
affective organizational commitment to your school.
How stressed are you?
Stress is an adaptive response to a situation that is perceived as challenging or threatening to the person’s well-being. It is an increasing concern in today’s society. This
self-assessment estimates your perceived general level of stress.
Are you a workaholic?
Some people have an uncontrollable work motivation, constantly think about work,
and have low work enjoyment. People with these personal characteristics are called
workaholics, and they tend to experience high levels of (dis)stress, which can produce
long-term health problems. This self-assessment estimates the degree to which you
have this stress-related personal characteristic.
How do you cope with stressful situations?
People cope with stress in several ways. The best coping strategy usually depends
on the source of stress and other circumstances. However, people also have a natural
preference for some types of coping strategies over others. This self-assessment identifies the type of coping strategy you prefer to use in stressful situations.
Foundations of Employee Motivation
After reading this chapter, you should be able to:
LO1 Define employee motivation and engagement.
LO2 Explain how drives and emotions influence employee motivation.
LO3 Discuss the employee motivation implications of four-drive theory, Maslow’s needs
hierarchy, intrinsic and extrinsic motivation, and learned needs theory.
LO4 Discuss the expectancy theory model, including its practical implications.
LO5 Outline organizational behaviour modification (OB Mod) and social cognitive theory,
and explain their relevance to employee motivation.
LO6 Describe the characteristics of effective goal setting and feedback.
LO7 Explain how equity theory, procedural justice, and interactional justice influence
employee motivation.
Accenture in Canada and globally has launched a
radically different way to motivate employees. The
consulting firm ditched its traditional performance
appraisal system in which managers annually evaluated employees, ranked their performance against
peers on a forced distribution scale, and held a
formal meeting to discuss the results for that time
period. Accenture now takes a coaching approach
to employee motivation and performance. Managers
have regular informal, constructive, forward-looking
discussions that focus on employee achievements
and career development. Employee performance is
no longer numerically scored or ranked.
“We realized that investing significant time in
backward-looking performance ­
To improve employee motivation, many Canadian
figuring out the Holy Grail of forced ­rankings—
organizations have replaced their traditional formal
simply does not yield the best outcomes for our
performance appraisal systems with more frequent, forwardlooking coaching and developmental conversations.
company or our people,” observes Nicholas
©Chris Ryan/OJO Images/age fotostock
Greschner, global HR business partner at
Accenture’s Canadian operations. “Millennials
and Gen Z-ers don’t want hierarchy, formal feedback processes, and appraisals. They demand real-time,
in-person feedback, forward-looking conversations and support to grow their careers.”
Chapter 5
Foundations of Employee Motivation 115
Adobe Systems Canada in Ottawa also replaced traditional performance reviews with much more frequent, constructive, and future-focused “Check-Ins” about employees’ personal development. “In a time
when agility, teamwork and innovation matter most, you can’t afford to breed competition, wait a year to
tell people how they are doing, and then have them leave because they were disillusioned with how they
ranked against their peers,” explains Donna Morris, global chief human resource officer of the software firm.
Accenture and Adobe aren’t the only businesses in Canada that are improving employee motivation
by ditching the traditional performance appraisal system. One recent survey reports that more than half
of Canadian organizations have updated their performance review process over the past two years. The
most common changes include making the process shorter, providing feedback more often, and eliminating performance rating scales.1
Accenture, Adobe Systems, and several other organizations
in Canada are discovering that their traditional performance
appraisal systems might not be motivating employees as much
as they thought. Some traditional performance reviews even
have the opposite effect; they disengage employees and motivate behaviour that undermines the organization’s success.
The theme of this chapter is employee motivation. We
begin by introducing the definition of motivation and the
often-stated associated phrase, employee engagement.
Next, we explain how drives and emotions are the prime
movers of employee motivation. The prominent drive-based
theories of motivation are then described. Next, expectancy
theory is described, including the practical implications of
this popular cognitive decision model of employee motivation. Organizational behaviour modification and social
cognitive theory are then introduced and linked to expectancy theory. The latter sections of this chapter outline the
key components of goal setting and feedback, and three
types of organizational justice: distributive, procedural, and
Employee Motivation, Drives,
and Needs
Employee motivation should be on anyone’s short list of the
most important topics in organizational behaviour. Why?
Because motivation is one of the four elements of the MARS
model, meaning that it is critical to understanding human
behaviour and performance (see Chapter 1). Even when people are able to perform the work (A), understand their role
responsibilities (R), and work in a setting that supports their
work objectives (S), they won’t get the job done without sufficient motivation (M) to achieve those tasks.
Motivation is defined as the forces within a person that
affect the direction, intensity, and persistence of their effort
for voluntary behaviour.2 Direction refers to what people are
focused on achieving; in other words, the goal or outcome
toward which they steer their effort. Intensity is the amount of
physical, cognitive, and emotional energy expended at a given
moment to achieve a task or other objective. Persistence, the
third element of motivation, refers to how long people sustain
their effort as they move toward their goal. In short, motivated
employees exert varying levels of effort (intensity), for varying lengths of time (persistence), toward various
motivation The forces within
goals (direction).
a person that affect the
direction, intensity, and perWhen executives discuss
sistence of effort for voluntary
employee motivation these
days, they are just as likely
to use the phrase employee
employee engagement A
engagement is an individuperson’s emotional and cogal’s emotional and cognitive
nitive motivation, particularly
a focused, intense, persistent,
(logical) motivation, particand purposive effort toward
ularly a focused, intense,
work-related goals.
persistent, and purposive
effort toward work-related
goals.3 It is associated with self-efficacy—the belief that you
have the ability, role clarity, and resources to get the job done
(see Chapter 3). Employee engagement also includes a high
level of absorption in the work—the experience of focusing
intensely on the task with limited awareness of events beyond
that work.
Employee engagement predicts employee and work unit
performance.4 Unfortunately, surveys consistently report
that few Canadian employees are fully engaged at work. The
numbers vary across studies, but recent results from a widely
recognized survey estimate that only 34 percent of employees in Canada are engaged, and 13 percent are actively disengaged. Actively disengaged employees tend to be disruptive
at work, not just disconnected from work. The lowest levels of employee engagement are recorded in several Asian
countries (Japan, China, South Korea, and Taiwan) and a few
European countries (notably Italy, Netherlands, and France).
The highest levels of employee engagement are reported in
the United States, Brazil, and India.5
116 Part Two
Individual Behaviour and Processes
©Accent Inns
Employee engagement is important at Accent Inns. The Victoria, B.C.-based hotel group provides an onboarding
program for new hires, comprehensive training programs, two-way feedback, and active involvement in community
support projects. Ninety-eight percent of employees say they are happy working at Accent Inns. For the top three words
that describe working there, employees chose Family, Fun, and Encouraging. “I want our hotels to be little communities,”
says Accent Inns CEO Mandy Farmer. “Little families where people take care of each other and where they feel like they
are well taken care of.” Accent Inns was recently recognized at the North American Employee Engagement Awards. It
also received the Employees First Award for its employment practices in the the B.C. Tourism industry.*
* “Case Study: Accent Inns: Looking After Your Staff Lets Your Business Look After Itself,” Go2HR (blog), May 13, 2016; “Hotel Zed Wins Award for Going the
Extra Mile for Employees,” Kelowna Capital News, March 2, 2019; “Accent Inns Recognized at Employee Engagement Awards,” Hotelier Magazine, June 28,
2019.The quotation and recent survey results were provided by Accent Inns in March 2020.
To build a more engaged and motivated workforce, we first
need to understand where motivation begins, that is, the motivational “forces” or “prime movers” of employee behaviour.6
Our starting point is drives
drives Hardwired character(also
istics of the brain that correct
needs), which we define as
deficiencies or maintain an
hardwired characteristics
internal equilibrium by proof the brain that attempt
ducing emotions to energize
to keep us in balance by
Neuroscience (brain) research has highlighted the central
role of emotions in this process. Specifically, drives produce
emotions that energize us to act on our environment.7 There
is no agreed-upon list of human drives, but research has consistently identified several, such as the drive to have social
interaction and bonding, to develop our competence, to make
sense of our surroundings, and to defend ourselves against
physical and psychological harm.8
Drives are universal and innate, which means that everyone has them and they exist from birth. Drives are the starting point of motivation because they generate emotions that,
as we learned in Chapter 4, put people in a state of readiness
to act on their environment. Cognition (logical thinking) also
Chapter 5
plays an important role in motivation, but emotions are the
real sources of energy in human behaviour.9 In fact, both
emotion and motivation originate from the same Latin word,
movere, which means “to move.”
Exhibit 5.1 illustrates how drives and emotions translate into felt needs and behaviour. Drives, and the emotions
produced by these drives,
needs Goal-directed forces
generate human needs.
that people experience.
We define needs as goal-­
directed forces that people
experience. They are the motivational forces of emotions
channelled toward specific goals and associated behaviours
to correct deficiencies or imbalances. For example, you
sense a need to interact with people after being alone for
a while, or to do something challenging after performing
tedious activities. As one leading neuroscientist explains:
“drives express themselves directly in background emotions
and we eventually become aware of their existence by means
of background feelings.”10 In other words, needs are the
emotions that we eventually become consciously aware of.
Consider the following example: You arrive at work to discover a stranger sitting at your desk. This situation produces
emotions (worry, curiosity) that motivate you to act. These
emotions are generated from drives, such as the drive to defend
and drive to comprehend. When strong enough, these emotions
motivate you to do something about this situation, such as finding out who that person is and possibly seeking reassurance
from co-workers that your job is still safe. In this case, you have
a need to make sense of what is going on (comprehend), to
feel secure, and possibly to correct a sense of personal violation (defend). Notice that your emotional reactions to seeing
the stranger sitting at your desk represent the forces that move
you, and that your logical thinking plays an active role in channelling those emotions toward specific goals and behaviours.
Everyone has the same drives; they are hardwired in us
through evolution. However, people develop different
Foundations of Employee Motivation 117
intensities of needs in a particular situation. Exhibit 5.1
explains why this difference occurs. The left side of the
model shows that the individual’s self-concept (as well as
personality and values), social norms, and past experience
amplify or suppress emotions, thereby resulting in stronger
or weaker needs.11 For example, people who define themselves as very sociable typically experience a need for social
interaction after being alone for a while, whereas people who
view themselves as less sociable would experience a less
intense need to be with others over that time. These individual differences also explain why needs can be “learned” to
some extent. Socialization and reinforcement may increase
or decrease a person’s need for social interaction, achievement, and so forth. We will discuss learned needs in the next
section of this chapter.
Individual differences—including self-concept, social
norms, and past experience—regulate the motivation process in a second way. They influence what goals and
behaviours are motivated by the felt emotions, as the right
side of Exhibit 5.1 illustrates. Consider the earlier example
of the stranger sitting at your desk. You probably wouldn’t
walk up to the person and demand that they leave; such
blunt behaviour is contrary to social norms in most cultures. Employees who view themselves as forthright might
approach the stranger directly, whereas those who have a
different personality and self-view are more likely to first
gather information from co-workers before approaching the
individual. In short, your drives (to comprehend, to defend,
to bond, etc.) and resulting emotions energize you to act, and
your self-concept, social norms, and past experience direct
that energy toward goal-directed behaviour.
Exhibit 5.1 provides a useful template for understanding how
drives and emotions are the prime sources of employee motivation and how individual characteristics (self-concept, experience, social norms) influence goal-directed behaviour. We will
refer to elements of this drive theory of motivation when we
discuss four-drive theory, expectancy theory, equity theory, and
other concepts in this chapter. The next section describes theories that explain the dynamics of drives and needs.
Drives, Needs, and Behaviour
Self-concept, social norms,
and past experience
and emotions
Decisions and
118 Part Two
Individual Behaviour and Processes
Drive-Based Motivation Theories
The process through which drives, emotions, and needs
influence motivation is most effectively explained by fourdrive theory. This thefour-drive theory A motiory states that emotions
vation theory based on the
are the source of human
innate drives to acquire, bond,
motivation and that these
comprehend, and defend that
emotions are generated
incorporates both emotions
through four drives (all of
and rationality.
which have been identified
from earlier psychological, sociological, and anthropological
• Drive to acquire. This is the drive to seek, take, control,
and retain objects and personal experiences. It produces
various needs, including achievement, competence,
status, and self-esteem.13 The drive to acquire also motivates competition.
• Drive to bond. This drive produces the need for belonging
and affiliation.14 It explains why our self-concept is partly
defined by associations with social groups (see Chapter
3). The drive to bond motivates people to cooperate and,
consequently, is essential for organizations and societies.
• Drive to comprehend. We are inherently curious and
need to make sense of our environment and ourselves.15
When observing something that is inconsistent with or
beyond our current knowledge, we experience a tension
that motivates us to close that information gap. The drive
to comprehend motivates curiosity as well as the broader
need to reach our knowledge potential.
• Drive to defend. This is the drive to protect ourselves
physically, psychologically, and socially. Probably the
first drive to develop in human beings, it creates a fightor-flight response when we are confronted with threats to
our physical safety, our possessions, our self-concept, our
values, and the well-being of people around us.16
All drives are hardwired in our brains and exist in all
human beings. They are also independent of one another;
there is no hierarchy of drives. Four-drive theory also claims
that no fundamental drives are excluded from the model.
Another key feature is that three of the four drives are
­proactive—we regularly try to fulfil them. Therefore, need
“fulfillment” is brief and ongoing. Only the drive to defend
is reactive—it is triggered by threat.
How Drives Influence Motivation
and Behaviour
Recall from Chapter 3 that the stimuli received through our
senses are quickly and nonconsciously tagged with emotional markers.17 Four-drive theory proposes that the four
drives determine which emotions are tagged to incoming
stimuli. Most of the time, we aren’t aware of these tagged
emotions because they are subtle and fleeting. However,
emotions do become conscious experiences when they are
sufficiently strong or when they significantly conflict with
one another.
Four-drive theory also recognizes that our social norms, personal values, and past experience—which the theory calls our
“mental skill set”—guide our motivational energy and reduce
the felt need (see Exhibit 5.2). In other words, our mental skill
set chooses courses of action that are acceptable to society,
consistent with our own moral compass, and have a high probability of achieving the goal of fulfilling our felt needs.18
Four-Drive Theory of Motivation
Drive to
Drive to
Drive to
Drive to
Mental skill set
channels emotional
forces created by drives
choice and effort
Chapter 5
Practical Implications of Four-Drive Theory
Four-drive theory recommends that jobs and workplaces
should provide a balanced opportunity for employees to fulfil the four drives.19 There are really two recommendations
here. The first is that the best workplaces help employees
fulfil all four drives. Employees continually seek fulfilment
of their innate drives, so successful companies provide sufficient rewards, learning opportunities, social interaction, and
so forth for all employees.
The second recommendation is that fulfilment of the four
drives must be kept in balance, that is, organizations shouldn’t
give employees too much or too little opportunity to fulfil
each drive. The reason for this advice is that the four drives
counterbalance each other. The drive to bond, which motivates mutual support and cohesion, counterbalances the drive
to acquire, which motivates competitiveness. An organization
that fuels the drive to acquire without encouraging the drive
to bond may eventually suffer from organizational politics,
dysfunctional conflict, and insufficient collaboration.20 The
drive to comprehend, which motivates investigation of the
unknown, counterbalances the drive to defend, which motivates avoidance of the unknown. Change and novelty in the
workplace will feed the drive to comprehend, but too much
of it will trigger the drive to defend to such an extent that
employees become territorial and resistant to change.
Foundations of Employee Motivation 119
Four-drive theory is based on a deep foundation of neuroscientific, psychological, sociological, and anthropological
research. The theory explains why needs vary from one person to the next and recognizes that motivation is influenced
by human thought and social influences (not just instinct).21
Even so, the theory is more recent than other motivation
models and is far from complete. Most experts would argue
that one or two other drives should be included. Furthermore,
social norms, personal values, and past experience probably
don’t represent the full set of individual characteristics that
translate emotions into goal-directed effort. For example,
personality and self-concept probably also moderate the
effect of drives and needs on decisions and behaviour.
Mention needs and drives
to most people and they will
probably refer to Maslow’s
needs ­
hierarchy theory,
which was developed by
Maslow in the 1940s.22
Maslow condensed and
Maslow’s needs hierarchy
theory A motivation theory
of needs arranged in a hierarchy, whereby people are
motivated to fulfill a higher
need as a lower one becomes
Global Connections 5.1
Petroliam Nasional Bhd (Petronas) is rated as the best
company to work for in Malaysia, partly because it
actively tries to balance employees’ fulfilment of their
four drives. The energy giant challenges employees to
step out of their comfort zone by acquiring new skills,
but this is counteracted with work–life integration and
supportive management.
Some employees say promotions and performance
standards are competitive, but this is balanced by
Petronas’ strong culture of teamwork. “Good place for
work–life balance,” says a Petronas application developer, who also points out that the company “greatly
challenge[s] your skill to the limit.”
A Petronas manager in Kuala Lumpur advises that
employees get “lots of new projects, which require moving out of [their] comfort zone,” but adds that the company
also fosters “good camaraderie with colleagues.” Another
Petronas technical employee observes: “The staff here
are team players. They are welcoming and helpful.”
* “PETRONAS Ranked the Most Attractive Company to Work for in 2019,” News Release (Kuala Lumpur: Randstad Malaysia, August 22, 2019). Employee
quotations are comments on Malaysia’s most popular job advertising site, jobstreet.com.my between December 2016 and January 2018.
120 Part Two
Individual Behaviour and Processes
How strong are your growth needs? You can discover your growth need strength by completing this
self-assessment in Connect.
Maslow’s Needs Hierarchy
Need to know
Need for beauty
organized the dozens of previously studied drives (which he
called primary needs) into five basic categories, organized in
a hierarchy from lowest to highest (see Exhibit 5.3):23 physiological (need for food, air, water, shelter, etc.), safety (need
for security and stability), belongingness/love (need for interaction with and affection from others), esteem (need for self-esteem and social esteem/status), and self-­actualization (need
for self-fulfilment, realization of one’s potential). Maslow also
identified two sets of needs outside the hierarchy. The need
to know recognizes that human beings are inherently curious
about the unknown and unexplained in their surroundings.
In addition, Maslow suggested that everyone has a need for
beauty (aesthetic needs)—an inherent attraction “to beauty,
symmetry, and possibly to simplicity, completion, and order.”24
Maslow proposed that we are motivated simultaneously
by several needs, but the strongest motivation comes from
the lowest unsatisfied need. When satisfied, the next higher
need in the hierarchy becomes the strongest motivator and
remains so even if never satisfied. The exception to this
need fulfilment process is self-actualization. Human beings
have an ongoing need for self-actualization; it is never really
fulfilled. Thus, while the bottom four groups are deficiency
needs because they become activated when unfulfilled,
self-actualization is known as a growth need because it continues to develop even when temporarily satiated.
Even though it is widely known, Maslow’s needs hierarchy theory was rejected long ago by motivation experts.25
The main flaw is that not everyone has the same needs hierarchy. Some people place social status at the top of their personal hierarchy, whereas others view personal development
and growth above social relations or status. This variation
occurs because employee needs are strongly influenced by
self-­concept, personal values, and personality.26 People have
different hierarchies of values (see Chapter 2), so they also
have parallel differences in their needs hierarchies. If your
most important values lean toward power and achievement, for
example, status needs will likely be at the top of your needs
hierarchy. Furthermore, a person’s values hierarchy can change
over time, so their needs hierarchy also changes over time.27
Why have we introduced Maslow’s needs hierarchy
model? One reason is that the theory is widely known and
incorrectly assumed to be valid; therefore, organizational
Chapter 5
behaviour students need to be aware of its true status. The
other reason is that through this theory, Maslow transformed
how we now think about human motivation.28 First, he
emphasized that needs should be studied together (holistically) because human behaviour is typically initiated by
more than one need at the same time (previously, needs
were studied separately from one another).29 Second, he recognized that motivation can be shaped by human thoughts
(such as personal values), whereas earlier motivation experts
focused mainly on how instincts motivate behaviour.30 Third,
Maslow adopted a positive view of motivation, whereas previous motivation theories focused on need deficiencies such
as hunger. Maslow’s positive perspective is revealed in his
emphasis on growth needs and self-actualization, suggesting
that people are naturally motivated to reach their potential.31
By extolling the importance of self-actualization, Maslow
launched an entirely new way of thinking about human motivation. People experience self-actualization by applying their
Foundations of Employee Motivation 121
skills and knowledge, observing how their talents achieve
meaningful results, and experiencing personal growth
through learning.
These are the conditions
intrinsic motivafor intrinsic motivation,
tion Motivation that occurs
which is motivation that
when people are fulfilling
occurs when people are
their needs for competence
and autonomy by engaging in
fulfilling their needs for
the activity itself, rather than
competence and autonomy
from an externally controlled
by engaging in the activity
outcome of that activity.
itself, rather than from an
externally controlled outcome of that activity.32 Intrinsically motivated employees apply
their talents toward a meaningful task and experience progress
or success in that task.33 They feel competent when applying
their skills and observing positive, meaningful outcomes from
that effort. They feel autonomous when their motivation is
self-initiated rather than controlled from an external source.
Intrinsic motivation contrasts with ­extrinsic ­motivation,
which is motivation that occurs when people want to engage
in an activity for instrumental reasons, that is, to receive
something that is beyond their personal control. This involves
Airbnb, San Francisco. USA. The/ZUMA Press/Newscom
Employees at Airbnb, the online vacation accommodation company, say they feel intrinsically motivated through
autonomy and personal growth. “I feel realized, motivated, welcomed every single day,” declares an Airbnb employee
in Sao Paulo, Brazil. “Lot of autonomy and a great company to work for,” reports an employee in the Netherlands.
“Fundamentally we believe that [employees] having more control over what they work on is more motivating and leads to
higher-quality results,” explains an Airbnb executive.*
* O. Thomas, “How Airbnb Manages Not to Manage Engineers,” readwrite, June 5, 2014; M. Curtis, “The Antidote to Bureaucracy Is Good Judgment,”
Airbnb News, Airbnb, May 15, 2015, http://nerds.airbnb.com/the-antidote-to-bureaucracy-is-good-judgement/. Employee quotations are from Glassdoor in
2015 and 2016.
122 Part Two
Individual Behaviour and Processes
directing one’s effort toward
a reward controlled by others that indirectly fulfils a
need. Extrinsic motivators
exist throughout organizations, such as pay incentives, recognition awards,
and frequent reminders
from the boss about work deadlines. Extrinsic motivation also
occurs indirectly, such as when we are motivated to complete
our part of a team project partly due to our concerns about
how team members will react if we submit it late or with inferior quality.
extrinsic motivation Motivation that occurs
when people want to engage
in an activity for instrumental
reasons, that is, to receive
something that is beyond
their personal control.
Does Extrinsic Motivation Undermine
Intrinsic Motivation?
There are two contrasting hypotheses about how extrinsic and intrinsic motivation work together.34 The additive
hypothesis is that someone performing an intrinsically motivating job becomes even more motivated by also receiving
an extrinsic source of motivation for that work. The extrinsic motivator energizes the employee more than the intrinsic
motivator alone. The contrasting hypothesis is that introducing extrinsic sources of motivation will reduce intrinsic
motivation. For example, employees who were energized by
the work itself will experience less of that intrinsic motivation when they receive extrinsic rewards, such as a performance bonus. The explanation is that introducing extrinsic
motivators diminishes the employee’s feeling of autonomy,
which is a key source of intrinsic motivation.
Which hypothesis is correct? So far, the research evidence
is mixed. Extrinsic motivators may reduce existing intrinsic
motivation to some extent and under some conditions, but
the effect is often minimal. Extrinsic rewards do not undermine intrinsic motivation when they are unexpected (e.g.,
a surprise bonus), when they have low value relative to the
intrinsic motivator, and when they are not contingent on
specific behaviour (such as receiving a fixed salary). Even
so, when employees are engaged in intrinsically motivating
work, employers should be careful about the potential unintended effect of undermining that motivation with performance bonuses and other sources of extrinsic motivation.35
In the previous section of this chapter, we explained that
needs are shaped, amplified, or suppressed through self-­
concept, social norms, and past experience. Maslow noted
this when he observed that individual differences influence the strength of higher-order needs, such as the need
to belong. Psychologist David McClelland further investigated the idea that a person’s needs can be strengthened or
weakened through reinforcement, learning, and social conditions. He examined three “learned” needs: achievement,
power, and affiliation.36
• People with a high need for achievement (nAch) choose
moderately challenging tasks, desire unambiguous feedback and recognition
for their success, and
need for achievement
prefer working alone
(nAch) A learned need in
rather than in teams.
which people want to accomplish reasonably challenging
Except as a source of
goals and desire unambigufeedback, money is
ous feedback and recognition
a weak motivator for
for their success.
people with high nAch,
whereas it can be a
strong motivator for those with low nAch.37 Successful
entrepreneurs tend to have a high nAch, possibly because
they establish challenging goals for themselves and
thrive on competition.38
• People with a high need
need for affiliation (nAff) A
for affiliation (nAff)
learned need in which people
seek approval from others,
seek approval from
conform to their wishes and
others, want to conform
expectations, and avoid conto others’ wishes and
flict and confrontation.
expectations, and avoid
conflict and confrontation. High nAff employees generally work well in jobs
responsible for cultivating long-term relations. However,
with a strong need for approval, high nAff employees
tend to be less effective at allocating scarce resources
and making other decisions that potentially generate
conflict. This suggests that leaders should have low
nAff, but a few studies have found that leaders should
have at least moderate levels of nAff to be supportive of
employee needs.39
• People with a high need for power (nPow) want to
exercise control over others, are highly involved in
team decisions, rely
on persuasion, and are
need for power (nPow) A
concerned about mainlearned need in which people
taining their leadership
want to control their environment, including people and
position. There are two
material resources, to benefit
types of nPow.40 The
either themselves (personalneed for personalized
ized power) or others (socialpower occurs when
ized power).
individuals enjoy their
power for its own sake,
use it to advance personal interests, and wear their power
as a status symbol. The need for socialized power exists
when individuals desire power as a means to help others.
Effective leaders have a high need for socialized rather
than personalized power. They demonstrate altruism and
Chapter 5
Foundations of Employee Motivation 123
How strong are your learned needs? You can discover the strength of these learned needs in you by
completing this self-assessment in Connect.
expectancy theory A motivaoffers a more detailed
tion theory based on the idea
understanding of the logthat work effort is directed
ical decisions employees
toward behaviours that
make when directing their
people believe will lead to
desired outcomes.
effort toward specific
behaviour. Essentially, the
theory states that work
effort is directed toward behaviours that people believe will
produce the most favourable outcomes. It assumes that people are rational decision makers who choose a target that will
best fulfil their needs. This choice is based on the probability that specific events will occur and the positive or negative valences (expected satisfaction) resulting from those
events.42 As illustrated in Exhibit 5.4, an individual’s level
of effort depends on three factors: effort-to-performance
(E-to-P) expectancy, performance-to-outcome (P-to-O)
expectancy, and outcome valences. Employee motivation is
influenced by all three components of the expectancy theory
model.43 If any component weakens, motivation weakens.
social responsibility and are concerned about the consequences of their own actions on others.
Changing (Learning) Need Strength
McClelland developed training programs to test the idea
that needs can be learned (amplified or suppressed)
through reinforcement, learning, and social conditions.
One program increased achievement motivation by having participants write achievement-oriented stories, practise achievement-­oriented behaviours in business games,
and meet frequently with other trainees to maintain their
new-found achievement motivation.41 These training programs changed how people viewed themselves (their
­self-concept), which amplified their need for achievement,
affiliation, or power.
Expectancy Theory of Motivation
• E-to-P expectancy. This is the individual’s perception
that their effort will result in a specific level of performance. In some situations, employees may believe that
they can unquestionably accomplish the task (a probability of 1.0). In other situations, they expect that even their
highest level of effort will not result in the desired performance level (a probability of 0.0). In most cases, the
The theories described so far mainly explain what motivates us—the prime movers of employee motivation—but
they don’t tell us what we are motivated to do. Four-drive
theory recognizes that social norms, personal values, and
past experience direct our effort, but it doesn’t offer any
detail about what goals we choose or where our effort is
directed under various circumstances.
Expectancy Theory of Motivation
E-to-P Expectancy
P-to-O Expectancy
Probability that a
specific effort level will
result in a specific
performance level
Probability that a
specific performance
level will result in
specific outcomes
Anticipated satisfaction
from the outcome
Outcome 1
Outcome 2
Outcome 3
124 Part Two
Individual Behaviour and Processes
E-to-P expectancy falls somewhere between these two
• P-to-O expectancy. This is the perceived probability that
a specific behaviour or performance level will lead to
a specific outcome. In extreme cases, employees may
believe that accomplishing a specific task (performance)
will definitely result in a specific outcome (a probability
of 1.0), or they may believe that successful performance
will have no effect on this outcome (a probability of
0.0). More often, the P-to-O expectancy falls somewhere
between these two extremes.
• Outcome valences. A valence is the anticipated satisfaction or dissatisfaction that an individual feels toward
an outcome.44 It ranges from negative to positive. (The
actual range doesn’t matter; it may be from − 1 to + 1 or
from − 100 to + 100.) Outcomes have a positive valence
when they are consistent with our values and satisfy our
needs; they have a negative valence when they oppose
our values and inhibit need fulfilment.
One of the appealing characteristics of expectancy theory
is that it provides clear guidelines for increasing employee
motivation.45 Several practical applications of expectancy
theory are listed in Exhibit 5.5 and described below.
Increasing E-to-P Expectancies
E-to-P expectancies are influenced by the individual’s
belief that they can successfully complete the task. In other
words, people with higher E-to-P expectancies have higher
­self-efficacy (see Chapter 3). Some companies increase this
can-do attitude by assuring employees that they have the
required abilities and resources as well as clear role perceptions to reach the desired levels of performance. An
important part of this process involves matching employee
abilities to job requirements and clearly communicating the
tasks required for the job. Similarly, E-to-P expectancies are
learned, so behaviour modelling and supportive feedback
typically strengthen the individual’s belief that they are able
to perform the task.
Increasing P-to-O Expectancies
The most obvious ways to improve P-to-O expectancies are
to measure employee performance accurately and distribute
more valued rewards to those with higher job performance.
P-to-O expectancies are perceptions, so employees also
need to believe that higher performance will result in higher
rewards. Furthermore, they need to know how that connection occurs, so leaders should use examples, anecdotes, and
public ceremonies to illustrate when behaviour has been
Practical Applications of Expectancy Theory
Expectancy theory component
E → P expectancies
To increase the employee’s belief they
are capable of performing the job
• Provide required training and clarify job requirements.
• Select people with the required skills and knowledge.
• Provide sufficient time and resources.
• Assign simpler or fewer tasks until employees can master them.
• Provide examples of similar employees who have successfully
performed the task.
• Provide coaching to employees who lack self-confidence.
P → O expectancies
To increase the employee’s belief that
their good performance will result in
specific valued outcomes
• Measure job performance accurately.
• Clearly explain the outcomes that will result from successful
• Describe how the employee’s rewards were based on past
• Provide examples of other employees whose good performance
has resulted in higher rewards.
Outcome valences
To increase the employee’s expected
value of outcomes resulting from
desired performance
• Distribute rewards that employees value.
• Individualize rewards.
• Minimize the presence of countervalent outcomes.
Chapter 5
Foundations of Employee Motivation 125
Performance-to-Outcome Expectancy: Motivation’s Weak Link*
of 8,254 employees surveyed in seven
countries (including Canada) say they have a good
understanding of how employees in their company
are compensated (36% say they don’t
have a good understanding).
of 615,395 U.S. federal government
employees believe that differences in performance
are recognized in a meaningful way in their work unit.
of 160,747 Canadian
government employees say that
unsatisfactory employee performance is
managed effectively in their department.
of 31,000 employees globally
believe there is a clear link between their
performance and their pay.
©Oxford/Getty Images
* Glassdoor, Global Salary Transparency Survey: Employee Perceptions of Talking Pay (Mill Valley, CA: Glassdoor, April 2016); “Global Workforce Study”
(London: Willis Towers Watson, 2017); “2018 Public Service Employee Survey: Results for the Public Service” (Ottawa: Government of Canada, Treasury Board
of Canada Secretariat, 2019); Office of Personnel Management, “2019 Federal Employee Viewpoint Survey” (Washington, DC: United States Government,
October 2019).
Increasing Outcome Valences
One size does not fit all when motivating and rewarding people. The valence of a reward varies from one person to the
next because each person has different need priorities. One
solution is to individualize rewards by allowing employees
to choose the rewards of greatest value to them. When this
isn’t possible, companies should find a reward that everyone values to some degree. Consider the following Canadian
story: Top-performing employees in one organization were
rewarded with a one-week Caribbean cruise with the company’s executive team. Many were likely delighted, but at least
one top performer was aghast at the thought of going on a
cruise with senior management. “I don’t like schmoozing, I
don’t like feeling trapped. Why couldn’t they just give me the
money?” she complained. In the end, the employee went on
the cruise, but spent most of her time working in her stateroom.46 Finally, we need to watch out for countervalent outcomes. If a company offers individual performance bonuses,
for example, it should beware of team norms that discourage
employees from working above a minimum standard. These
norms and associated peer pressure are countervalent outcomes to the bonus.
Overall, expectancy theory is a useful model that explains
how people rationally figure out the best direction, intensity, and persistence of effort. Early studies had difficulty
empirically researching expectancy theory, but the theory
seems to predict employee motivation in a variety of situations and cultures.47 Expectancy theory does have limitations, however.48 First, it assumes that people are perfectly
rational decision makers; in reality, human decisions are not
perfectly rational (see Chapter 7). A second concern is that
the theory mainly explains extrinsic motivation, whereas
applying the model’s features to intrinsic motivation is more
difficult (although not impossible). Third, expectancy theory
ignores emotions as a source of motivation. The valence element of expectancy theory captures some of this emotional
process, but only peripherally.49 Fourth, E-to-P and P-to-O
expectancies are critical components of expectancy theory,
yet the theory doesn’t explain how employees develop these
expectancies. Two theories that do explain how expectancies
are developed are organizational behaviour modification and
social cognitive theory, which we describe next.
Organizational Behaviour
Modification and Social Cognitive
Expectancy theory states that motivation is determined by
employee beliefs about expected performance and outcomes.
But how do employees learn these expectancy beliefs? For
126 Part Two
Individual Behaviour and Processes
example, how do they form the impression that one level of
task performance is more likely than another performance
level to produce a pay increase, promotion, or other outcomes? Two theories—organizational behaviour modification (OB Mod) and social cognitive theory—complement
expectancy theory by explaining how people learn what to
expect from their actions, which is how people develop the
expectancies that affect motivation.
For most of the first half of the 1900s, the dominant
paradigm about managing individual behaviour was
behaviourism, which argues that a good theory should
rely exclusively on behaviour and the environment and
ignore ­nonobservable cognitions and emotions.50 Although
behaviourists don’t deny the existence of human thoughts
and attitudes, they view them as unobservable and, therefore, irrelevant to scientific study. A variation
organizational behaviour
modification (OB Mod) A
of this paradigm, called
theory that explains employee
organizational behaviour
behaviour in terms of the
modification (OB Mod),
antecedent conditions
eventually entered organiand consequences of that
zational studies of motivabehaviour.
tion and learning.51
A-B-Cs of OB Mod
The core elements of OB Mod are depicted in the A-B-C
model shown in Exhibit 5.6. Essentially, OB Mod attempts
to change behaviour (B) by managing its antecedents (A)
and consequences (C).52 Consequences are events following a particular behaviour that influence its future occurrence. Consequences include receiving words of thanks from
co-workers after assisting them, enjoying preferred work
schedules after being with the company longer than the average employee, and finding useful information on your smartphone after checking for new messages. Consequences also
include no outcome at all, such as when no one says anything
about how well you have been serving customers.
Antecedents are events preceding the behaviour, informing employees that a particular action will produce specific
consequences. An antecedent could be a sound from your
smartphone signalling that a text message has arrived. Or
it could be your supervisor’s request to complete a specific
task by tomorrow. Notice that antecedents do not cause
behaviour. The sound from your smartphone doesn’t cause
you to open the text message. Rather, the sound (antecedent)
is a cue signalling that if you look at your phone messages
(behaviour), you will find a new message with potentially
useful information (consequence).
Contingencies and Schedules
of Reinforcement
OB Mod identifies four types of consequences, called the contingencies of reinforcement.53 Positive reinforcement refers to
any consequence that, when introduced, increases or maintains
the frequency or future probability of a specific behaviour.
Receiving praise from co-workers is an example of positive
reinforcement because the praise usually maintains or increases
your likelihood of helping them in future. Punishment refers to
any consequence that decreases the frequency or future probability of a specific behaviour occurring. Most of us would
consider being demoted or criticized by our co-workers as
forms of punishment. A third type of consequence is extinction. Extinction occurs when the target behaviour decreases
because no consequence follows it. For instance, research suggests that performance tends to decline when managers stop
congratulating employees for their good work.54
A-B-Cs of Organizational Behaviour Modification
What happens
before the behaviour
What the person
says or does
What happens
after the behaviour
You check your phone
for a new message
You learn useful
information from the new
message on your phone
Your phone makes a
distinctive sound
Chapter 5
The fourth consequence in OB Mod, called negative reinforcement, is often confused with the application of punishment. It’s actually the opposite—the removal of punishment.
Negative reinforcement occurs when the removal or avoidance of a consequence increases or maintains the frequency
or future probability of a specific behaviour. For example,
managers apply negative reinforcement when they stop
criticizing employees whose substandard performance has
Which of these four consequences works best? In most
situations, positive reinforcement should follow desired
behaviours and extinction (do nothing) should follow undesirable behaviours. Positive reinforcement is preferred
because focusing on the positive rather than negative aspects
of life tends to improve organizational success and individual well-being.55 In contrast, punishment and negative reinforcement generate negative emotions and attitudes toward
the person (e.g., supervisor) and organization who initiated
and later removed the punishment. However, punishment
(dismissal, suspension, demotion, etc.) may be necessary
consequences for extreme behaviours, such as deliberately
hurting a co-worker or stealing inventory. Indeed, research
suggests that, under some conditions, punishment maintains
a sense of fairness among those affected by or aware of the
employee’s indiscretion.56
Along with the four consequences, OB Mod considers the
frequency and timing of these reinforcers (called the schedules of reinforcement).57 The most effective reinforcement
schedule for learning new tasks is continuous reinforcement— providing positive reinforcement after every occurrence of the desired behaviour. For motivating behaviour,
the most effective reinforcement schedule tends to be the
variable ratio schedule---providing positive reinforcement
after a varying number of times. Salespeople experience
variable ratio reinforcement because they make a successful sale (positive reinforcement) after a varying number of
client calls. The variable ratio schedule makes behaviour
highly resistant to extinction because the reinforcer is never
expected after a fixed period of time or after a fixed number
of behaviours.
Evaluating OB Mod
Everyone uses organizational behaviour modification principles in one form or another to motivate people. We thank
co-workers for a job well done, are silent when displeased,
and sometimes try to punish those who go against our
wishes. OB Mod also occurs in various formal programs to
reduce absenteeism, improve task performance, encourage
safe work behaviours, and promote a healthier lifestyle. An
innovative and increasingly popular workplace behaviour
modification strategy relies on “gamification”—reinforcing behaviour through digital games in which employees
Foundations of Employee Motivation 127
earn points and “badges” and compete for top positions on
leader boards. Research indicates that gamification potentially reinforces learning and desired behaviours through
positive reinforcement and extinction. However, it can also
produce negative outcomes (lower performance, higher
employee turnover, etc.) when the intervention electronically monitors employee behaviour or is linked to financial
In spite of its widespread use, organizational behaviour
modification has a number of limitations. One limitation
is “reward inflation,” in which the reinforcer is eventually considered an entitlement. For this reason, most OB
Mod programs must run infrequently and for a short duration. Another concern is that the variable ratio schedule
of reinforcement tends to create a lottery-style reward
system, which might be viewed as too erratic for formal
rewards and is unpopular to people who dislike gambling.
Probably the most significant problem is OB Mod’s radical view that behaviour is learned only through personal
interaction with the environment.59 This view is no longer
accepted; instead, experts recognize that people also learn
and are motivated by observing others and inferring possible consequences of their actions. This learning process is
explained by social cognitive theory.
Social cognitive theory
social cognitive theory
states that much learning
A theory that explains how
occurs by observing and
learning and motivation occur
modelling others as well as
by observing and modelling
by anticipating the conseothers as well as by anticipating the consequences of our
quences of our behaviour.60
Observation and modelling (imitation) had been
studied for many years, but Canadian social scientist Albert
Bandura reframed these ideas within a cognitive (internal
thoughts) perspective as an alternative to the behaviourist
approach. There are several pieces to social cognitive theory, but the three most relevant to employee motivation are
learning behaviour consequences, behaviour modelling, and
Learning Behaviour Consequences
People learn the consequences of behaviour by observing
or hearing about what happened to other people, not just
by directly experiencing the consequences.61 Hearing that a
co-worker was fired for being rude to a client increases your
belief that rude behaviour will result in being fired. In the
language of expectancy theory, learning behaviour consequences changes a person’s perceived P-to-O expectancy.
Furthermore, people logically anticipate consequences in
128 Part Two
Individual Behaviour and Processes
Global Connections 5.2
To improve employee knowledge about its global capabilities (audit, tax, advisory, etc.), KPMG developed an
app that applies OB Mod principles through gamification. “We needed to do something different and fun and
used game elements like time pressure, rapid feedback,
and scores to engage our people,” explains an executive at the professional services firm.
Through the app, called Globerunner, players race
around the world answering questions about the firm’s
service capabilities in various global operations, such
as, “A CFO needs help with X—which offering can help?”
They acquire points for correct answers, earn badges
for completed missions, and gain access to questions
in other locations. They can also compare their success
against co-workers on a global leaderboard and challenge others in tournaments.
KPMG estimates that Globerunner has improved
employee knowledge by 24 percent. More than
80 percent of employees (including those who don’t
play online games) enjoyed the learning experience.
©Jose Luis Pelaez Inc/Blend Images LLC
* C. Mazy, “How Companies Can Raise Their Game,” Financial Times—IE Corporate Learning Alliance, February 19, 2018;KPMG International, “Playing for
Success” (Amstelveen, The Netherlands, June 28, 2018).
related situations. For instance, the story about the fired
employee might also strengthen your P-to-O expectancy that
being rude toward co-workers and suppliers (not just clients)
will get you fired.
Behaviour Modelling
Along with observing others, people learn by imitating
and practising their behaviours.62 Modelling the behaviour
of others gives learners direct sensory experience, which
helps them to acquire knowledge and skills, such as the
subtle ­person–machine interaction while driving a ­vehicle.
Behaviour modelling also increases E-to-P e­xpectancy
because people develop a stronger self-efficacy (see
Chapter 3) after observing others and performing the task
successfully themselves. Self-efficacy particularly improves
when observers are similar to the model in age, experience,
gender, and related characteristics.
An important feature of social cognitive theory is that
human beings set goals and engage in other forms of intentional, ­
purposive action.63 They establish their own shortand ­
long-term objectives, choose their own standards of
achievement, work out a plan of action, consider back-up alternatives, and have the forethought to anticipate the ­consequences of
their goal-directed behaviour.
Furthermore, people selfself-reinforceregulate by engaging in self-­
ment Reinforcement that
occurs when an employee
reinforcement; they reward
has control over a reinforcer
and punish themselves for
but doesn’t ‘take’ it until comexceeding or falling short
pleting a self-set goal.
of their self-set goals. For
example, you might have
a goal of completing the rest of this chapter, after which you
reward yourself by having a snack. Raiding the refrigerator is a
form of self-induced positive reinforcement for completing this
reading assignment.
OB Mod and social cognitive theory explain how people learn probabilities of successful performance (E-to-P
expectancies) as well as probabilities of various outcomes
from that performance (P-to-O expectancies). As such, these
theories explain motivation through their relationship with
expectancy theory of motivation, described earlier. Elements
of these theories also help us to understand other motivation
processes. For instance, self-regulation is the cornerstone of
motivation through goal setting and feedback, which we discuss next.
Chapter 5
Goal Setting and Feedback
Key performance indicators, task objectives, stretch targets, job duties. No matter what they are called, goals figure
prominently in everyone’s
goal A cognitive represenjob. A goal is a cognitive
tation of a desired end state
representation of a desired
that a person is committed to
end state that a person
is committed to attain.64
Goals motivate people by
clarifying role perceptions and, consequently, the direction
of effort. Goals also amplify the intensity and persistence
of effort because they make it easier to judge how much
energy is required to reach them. However, the motivational
potential of goals depends on how well they are stated.65
Rather than just trying to “do your best,” effective goals
have several characteristics identified in the popular acronym
Foundations of Employee Motivation 129
• Specific. Goals lead to better performance when they are
specific. Specific goals state what needs to be accomplished, how it should be accomplished, and where, when,
and with whom it should be accomplished. Specific goals
clarify performance expectations so employees can direct
their effort more efficiently and reliably.
• Measurable. Goals need to be measurable because
motivation occurs when people have some indication
of their progress and achievement of those goals. This
measurement ideally includes how much (quantity), how
well (quality), and at what cost the goal was achieved.
However, some types of employee performance are difficult to measure, and they risk being neglected in companies preoccupied with quantifiable outcomes.67
• Achievable. One of the trickiest aspects of goal setting
is developing goals that are sufficiently but not overly
challenging.68 Easy goals motivate employees to perform
well below their potential. Yet goals that are too challenging may also lead to substandard effort if employees
©Bojan Milinkov/Shutterstock
The City of Toronto’s call centre—311 Toronto—operates 24 hours per day, 7 days per week, and answers 3.6 million
non-emergency customer calls in 180 languages each year. As the largest call centre of its kind in North America, 311
Toronto motivates its employees with SMARTER goals. One goal is to answer 80 percent of the calls within 75 seconds.
Another objective is that conversations have an average talk time of 270 seconds. A third goal is to resolve 70 percent
of calls at the first point of contact (i.e., not forwarding the caller elsewhere or calling back later). The 311 Toronto
operations centre also strengthens employee motivation through visual feedback. On one wall is a massive screen that
displays current statistics associated with these and other key performance indicators.*
* M. Warren, “Toronto Is Known for Dead Raccoons and Potholes. The City’s 311 Nerve Centre Knows This Reputation Is Well-Earned,” Toronto Star,
November 18, 2018; “311 Toronto Budget Notes,” Budget TO 2019 (Toronto: City of Toronto, January 25, 2019).
130 Part Two
Individual Behaviour and Processes
believe there is a low probability of accomplishing them
(i.e., low E-to-P expectancy). Recent studies have also
found that very difficult goals increase the probability
that employees will engage in unethical behaviour to
achieve them.69
• Relevant. Goals need to be relevant to the job and within
the employee’s control. For example, a goal to reduce
waste materials won’t motivate employees who have negligible control over waste in the production process.
• Time-framed. Goals need a due date. They should specify
when the objective should be completed or when it will
be assessed for comparison against a standard.
• Exciting. Goals tend to be more effective when employees
are committed to them, not just compliant. Challenging
goals tend to be more exciting for most (but not all)
employees because growth need fulfilment is stronger
when difficult goals are achieved. Goal commitment also
increases when employees are involved in goal setting.70
• Reviewed. The motivational value of goals depends on
employees receiving feedback about reaching those goals.71
Effective feedback requires measurement, which we discussed earlier in this list, but it also includes reflecting on
or discussing with others your goal progress and accomplishment. Reviewing goal progress and accomplishment
helps employees to redirect their effort. It is also a potential
source of recognition that fulfils growth needs.
The opening case study for this chapter described why
Accenture and Adobe Systems in Canada and elsewhere have
replaced their traditional performance appraisal systems with
real-time, coaching-oriented feedback. This dramatic shift
has occurred mainly because traditional performance reviews
do not satisfy some of the critical features of effective feedback. Feedback—information that lets us know whether we
have achieved the goal or are properly directing our effort
toward it—is an essential partner with goal setting. Feedback
contributes to motivation and performance by clarifying role
perceptions, improving employee skills and knowledge, and
strengthening self-efficacy.72
Effective feedback has many of the same characteristics as
effective goal setting (see Exhibit 5.7).73 It should be specific,
Characteristics of Effective Feedback
Feedback characteristic
Information refers to identifiable
behaviours and (when possible) measurable
“Inventory shrinkage (theft, damage) fell to 1 percent of inventory
over the previous three months.”
Information should relate to behaviours and
outcomes within the individual’s or team’s
“You have submitted the monthly budget reports without error and on
time every month over the past year, one of the few district managers
to do so.” (Where district managers have few situational barriers to
submitting the reports accurately or on schedule).
Information should be available soon after
the behaviour or results occur
“Two of our customers noted this week that you were unable to
answer their questions about how the new widget model differs from
the previous model.”
Information source should:
Supervisor has good knowledge of the employee’s job duties,
regularly observes them performing the work, and offers constructive
feedback with optimism and sensitivity on how the employee can
perform specific tasks better.
• have complete and accurate information
• recall information reliably
• be unbiased in communicating and
applying the feedback
• describe the feedback in a supportive
and empathetic manner
Sufficiently frequent
Information is provided:
• more often for those learning new tasks
• according to the job cycle’s frequency
Supervisor meets twice monthly with every experienced production
employee and checks in at least twice weekly with every new
employee to discuss their individual safety behaviour and output
(where task cycle times are usually less than one hour).
Chapter 5
meaning that the information should refer to identifiable
behaviours and, when possible, measurable outcomes (e.g.,
sales increased by 5 percent last month). Feedback should
also be relevant; it should relate to behaviours and outcomes
within the individual’s or team’s control. Effective feedback
is also timely, that is, the information is available soon after
the behaviour or results occur—not six months later in a performance review meeting. Timely feedback gives employees a
clearer association between their actions and the consequences.
A fourth characteristic of effective feedback is that it is credible. A feedback source is credible when employees believe
that person has complete and accurate information about the
employee’s performance, is reliable at recalling that information, is unbiased in communicating and applying the feedback
to decisions (such as performance ratings), and describes the
feedback in a supportive and empathetic manner. These conditions explain why performance feedback is typically less
credible during traditional performance appraisals than during
real-time coaching-style feedback.74 Supervisors have difficulty completely and reliably recalling performance information over such a long time. In addition, supervisors have two
roles—coach and judge—in traditional performance reviews.
Foundations of Employee Motivation 131
The latter can undermine the supervisor’s perceived neutrality
as well as supportiveness during the feedback session.
One other important characteristic of effective feedback
is that it should be sufficiently frequent. How frequent is
“sufficiently”? The answer depends on at least two things.
One consideration is the employee’s knowledge and experience with the task. Employees working on new tasks
should receive more frequent feedback because they require
more behaviour guidance and reinforcement. Experienced
employees can receive less frequent feedback when performing familiar tasks. The second factor is how long it takes to
complete the task (i.e., its cycle time). Less frequent feedback usually occurs in jobs with a long cycle time (e.g., executives and scientists) because indicators of goal progress and
accomplishment in these jobs are less frequent than in jobs
with a short cycle time (e.g., grocery store cashiers).
Feedback through Strengths-Based
As the co-founder of Vancouver-based WealthBar, Tea
Nicola is nurturing a “culture of healthy management,”
which includes plenty of strengths-based coaching to
Global Connections 5.3
Stryker is rated as one of the top places to work in
Canada, the United States, Australia, and in most other
regions where the medical devices firm does business.
These accolades are partly due to Stryker’s deeply
embedded practice of strengths-based coaching.
Employees discover their strengths through a commercial assessment, and the company encourages them to
let co-workers know their top five strengths.
“Stryker has an amazing culture, built by amazing
people,” says one of the company’s inventory managers
at its Canadian headquarters in Hamilton, Ontario. “I
get to use my unique combination of strengths to solve
problems and deliver results for our customers. I am
my authentic self at work and am grateful to be able to
work at a place that celebrates my achievements.”
“We work with people to understand how to use their
strengths in a positive way, and encourage them to own
their career using those strengths,” says Erin Cramlet,
Stryker South Pacific HR director. Ryan McCarthy, managing director at Stryker-Medical Asia Pacific, explains
further: “What strengths has allowed me to do as a
leader is to truly treat people as individuals and find the
best in each person.” McCarthy says his role as a leader
is “to ensure the individual has the opportunity to use
those strengths every day in an engaging environment.”
* Gallup Strengths Center, ‘Gallup Called to Coach with Ryan Mccarthy–Australia Singapore Edition’, Podcast in Called to Coach, (YouTube, 5 October 2016);
C. Scobie, ‘Fighting the Good Fight, for the People’, Acuity, Feb/March 2017; ‘5 Keys to Strengths-Based Talent Success at Australia’s Best Place to Work’,
Inside HR, 29 January 2018.
132 Part Two
Individual Behaviour and Processes
employees. “Focusing people on what they’re bad at is what
creates anxiety, and that leads to negativity toward the workplace,” Nicola warns. Kyron Keogh agrees. “It’s important to
reward and encourage strengths. Instead of looking at weakness, look at areas for development,” says the co-founder of
Rox, the award-winning luxury retail jewellery chain headquartered in Glasgow, Scotland. “It’s vital to ensure that staff
stay motivated and upbeat in a sales environment.”75
Strengths-based coaching (also known as appreciative
coaching) is a positive approach to feedback that maximizes
employees’ potential by
focusing on their strengths
strengths-based coachrather than weaknesses.76 In
ing An approach to coaching
strengths-based coaching,
and feedback that focuses on
building and leveraging the
employees describe areas
employee’s strengths rather
of work where they excel or
than trying to correct their
demonstrate potential. The
coach directs this discussion by asking exploratory
questions that help employees discover ways to build these
strengths. Situational barriers, as well as strategies to overcome
those barriers, are identified to further support the employee’s
Strengths-based coaching might not be best in all situations, but it is associated with higher employee motivation,
satisfaction, self-efficacy, and relations with management.77
One reason is that people are more receptive to information
about their strengths than they are to information about their
flaws. In fact, for more than three decades scholars have
warned that traditional problem-focused feedback leads to
employee defensiveness and potentially lower self-efficacy,
which can result in reduced (rather than increased) employee
performance.78 Strengths-based coaching also makes sense
because personality becomes quite stable in the early stages of
an individual’s career, which limits their flexibility regarding
interests, preferences, and abilities.79 Consequently, employees become less motivated and less able to improve themselves in areas where they previously lacked interest or skill.
Feedback can originate from nonsocial or social sources.
Nonsocial sources provide feedback without someone communicating that information. Corporate intranets allow many
executives to receive feedback instantaneously on their computer or other digital device, usually in the form of graphic
output on an executive dashboard. Employees at contact centres view electronic displays showing how many callers are
waiting and the average time they have been waiting.
Some companies set up multisource (360-degree) feedback which, as the name implies, is information about an
employee’s performance collected from a full circle of
people, including subordinates, peers, supervisors, and customers. Multisource feedback tends to provide more complete
and accurate information than feedback from a supervisor
alone. It is particularly useful when the supervisor is unable
to observe the employee’s behaviour or performance in every
situation. Lower-level employees also feel a greater sense
of fairness when they are able to provide upward feedback
about their boss’s performance.80
However, multisource feedback can be expensive and
time-consuming. Furthermore, people have markedly different opinions about an employee, so multisource feedback can
be more confusing than meaningful. A third concern is that
peers tend to minimize interpersonal conflict by providing
inflated rather than accurate feedback. A fourth issue is that
employees experience a stronger emotional reaction when
they receive critical feedback from many people rather than
from just one person (such as the boss).
The preferred feedback source depends on the purpose
of the information. Feedback from nonsocial sources, such
as digital images or feedback directly from the job, is better when employees need to learn about goal progress and
accomplishment. This is because information from nonsocial
sources is considered more accurate than information from
social sources. Negative feedback from nonsocial sources is
also less damaging to self-esteem. In contrast, social sources
tend to delay or exclude some negative information as well
as distort the bad news in a positive way.81 Employees should
receive some positive feedback from social sources. It feels
better to have co-workers say that you are performing the job
well than to discover this from data on an impersonal digital
Goal setting (in partnership with feedback) is generally a
highly effective practice for employee motivation and performance.82 Putting goal setting into practice can be challenging, however.83 It tends to focus employees on a narrow
subset of measurable performance indicators while ignoring
aspects of job performance that are difficult to measure. This
problem is captured in the saying: “What gets measured, gets
done.” Another concern is that very difficult goals may motivate some people to engage in unethical behaviour to achieve
those targets. Difficult goals are also stressful, which can
undermine overall job performance.
Yet another problem is that goal setting tends to interfere
with the learning process in new, complex jobs. Therefore,
setting performance goals may be effective for employees
who are already experienced in a job but should be avoided
where they are in the middle of an intense learning process. A final issue is that when goal achievement is tied to
Chapter 5
Foundations of Employee Motivation 133
What is your goal orientation? You can discover your dominant goal orientation by completing this
self-assessment in Connect.
financial rewards, many employees are motivated to set easy
goals (while making the boss think they are difficult) so
that they have a higher probability of receiving the bonus or
pay increase. As a former Ford Motor Company CEO once
quipped: “At Ford, we hire very smart people. They quickly
learn how to make relatively easy goals look difficult!”84
Organizational Justice
Treating employees fairly is both morally correct and good
for employee motivation, loyalty, and well-being. Yet feelings
of injustice occur regularly in the workplace. Almost half of
Canadians in accounting, finance, technology, and related
jobs believe they are underpaid, whereas only 1 p­ ercent say
they are overpaid. The other 50 percent of those surveyed say
they are adequately paid. Two surveys of American employees report almost identical results. Half believe their pay is
fair, a little under half think they are underpaid, and 5 percent
say they are overpaid.85 These examples are about fair pay,
but there are many other types of perceived workplace injustices, such as who gets promoted, how employees are treated
by management, and whether resource allocation decisions
are transparent and unbiased.
How can we improve workplace justice? Our answer
begins by explaining that there are several types of organizational justice, each of which has some degree of unique
influence on whether people believe the situation is fair or
unfair.86 We will discuss the three most common varieties
(there are others): distributive, procedural, and interactional
justice. All three types of justice refer to the perception that
appropriate formal or informal rules have been applied to the
situation. People have a sense of fairness when they believe
those rules are being followed.87
• Distributive justice refers to the perception that appropriate decision criteria (rules) have been applied to
calculate how various
distributive justice The
benefits and burdens are
perception that appropriate
distributed. These critedecision criteria (rules) have
ria—such as effort, need,
been applied to calculate how
or ­membership—determine
various benefits and burdens
how much each person
are distributed.
should receive, such as
higher pay, more tedious tasks, better workspace, and so on.
• Procedural justice is the perception that appropriate procedural rules have been applied throughout the
decision process.
Procedural justice tends
to be higher, for example, when the decision
maker demonstrates
neutrality (no favouritism), allows everyone
involved to have their
say, and allows an
appeal of the decision.
procedural justice The
perception that appropriate
procedural rules have been
applied throughout the decision process.
interactional justice The
perception that appropriate
rules have been applied in
the way the people involved
are treated throughout the
decision process.
• Interactional justice
is the perception that
appropriate rules have
been applied in the way
employees are treated throughout the decision process.
For example, we believe there is interactional justice
when the decision maker is polite toward the potential
beneficiaries and is honest and candid in providing information about the decision.
At its most basic level, employment in any organization is
an exchange relationship; we provide our time, skills, and
behaviour in exchange for pay, fulfilling work, skill development opportunities, and so forth. What is considered “fair” in
this exchange relationship depends on what criteria we use to
determine distributive justice in various situations.88 In some
situations, we might believe that everyone should receive the
same benefits. This equality principle is applied, for instance,
when everyone gets subsidized meals in the company cafeteria.
In other situations, we believe that those with the greatest need
should receive more outcomes than those with less need (called
the need principle). An example of this principle is the practice
of giving employees who are ill paid time off to recover. The
equity principle states that the benefits people receive should
be in proportion to what they contribute to the organization.
The equity principle relates to the most common set of distributive justice rules in organizational settings, so let’s look at
equity-based distributive justice in more detail.
Feelings of equity are
equity theory A theory
explained by equity theory,
explaining how people
which says that employees
develop perceptions of fairdetermine whether a deciness in the distribution and
sion is equitable by comexchange of resources.
paring their own outcome/
134 Part Two
Individual Behaviour and Processes
It seems obvious that employees with higher performance,
skills, or other contributions to the organization should
receive more generous pay and other rewards. Increasing
the pay differential (wage dispersion) between high and
low contributors should boost employee motivation to
achieve a higher standard of performance. It should also
increase company performance by motivating the top performers to stay and the bottom performers to leave. A large
wage dispersion is also consistent with justice and fairness. Differentiating rewards based on employee performance, skills, and other forms of contribution is consistent
with the principle of meritocracy. It is also consistent with
the ethical principle of justice, which states that those who
contribute more should receive more in return (Chapter 2).
Furthermore, performance-based pay is one of the pillars
of human capital (see Chapter 1).
But workplaces that have large wage dispersions might
not be receiving the performance dividends they expect.
Several (but not all) studies have found that sports teams
with relatively small pay differences among team members
perform better than sport teams with relatively high pay
differences. Teams that pay huge salaries or bonuses to
stars do not score more points or win more games. Also,
turnover among players and managers tends to increase
with the size of the wage dispersion. One study extended
these observations to all industries. Companies that have
a higher dispersion of wage increases (larger increases
to higher-paid staff) perform worse than companies with
an equal dispersion of wage increases. Another study
reported that information technology companies with
larger salary differences among top management teams
had worse shareholder returns and market-to-book value
compared to IT companies with less pay inequality.
Why would larger pay ranges undermine rather than
enhance employee and organizational performance?
One reason is that pay differences produce status differences, which can undermine cooperation among employees. A second reason is that large pay differences might
increase (rather than decrease) feelings of injustice.
Most people think they are above average, so large pay
differences clearly place many employees below their
self-evaluations. Also, employees tend to underestimate
the contribution of higher-paid c­ o-workers and assume
those higher-paid co-workers also receive other rewards
(such as preferential treatment). In short, ­
employees often believe higher-paid employees are
overpaid, which reduces the lower-paid workers’ motivation and performance.
* C. Grund and N. Westergaard-Nielsen, “The Dispersion of Employees’ Wage Increases and Firm Performance,” Industrial & Labor Relations Review 61, no. 4
(2008): 485–501; H. Katayama and H. Nuch, “A Game-Level Analysis of Salary Dispersion and Team Performance in the National Basketball Association,” Applied
Economics 43, no. 10 (2011): 1193–207; P.E. Downes and D. Choi, “Employee Reactions to Pay Dispersion: A Typology of Existing Research,” Human Resource
Management Review 24, no. 1 (2014): 53–66; S.A. Conroy et al., “A Multilevel Approach to the Effects of Pay Variation,” Research in Personnel and Human
Resources Management 32 (2014): 1–64.
input ratio to the outcome/input ratio of another person or
group.89 As Exhibit 5.8 illustrates, the outcome/input ratio is
the value of the outcomes you receive divided by the value
of the inputs you provide in the exchange relationship. Inputs
include such things as skill, effort, reputation, performance,
experience, and hours worked. Outcomes are what employees
receive from the organization, such as pay, promotions, recognition, interesting jobs, and opportunities to improve one’s
skills and knowledge.
A central feature of equity theory is that individuals
determine fairness in terms of a comparison other.90 The
comparison other might be another person or group of
people in other jobs (e.g., comparing your pay with the
CEO’s pay) or another organization. Some research suggests that employees frequently collect information on several referents to form a “generalized” comparison other.91
For the most part, however, the comparison other varies
from one person and situation to the next and is not easily
The comparison of our own outcome/input ratio with the
ratio of someone else results in perceptions of equity, underreward inequity, or overreward inequity. In the equity condition, people believe that their outcome/input ratio is similar
to the ratio of the comparison other. In the underreward
inequity situation, people believe their outcome/input ratio
is lower than the comparison other’s ratio. In the overreward
inequity condition, people believe their outcome/input ratio
is higher than the comparison other’s ratio.
Inequity and Employee Motivation
How do perceptions of equity or inequity affect employee
motivation? The answer is illustrated in Exhibit 5.9. When
people believe they are under- or overrewarded, they experience negative emotions (called inequity tension).92 As we
Chapter 5
Foundations of Employee Motivation 135
Equity Theory Model
Comparison Other’s
Outcome/Input Ratio
Outcome/Input Ratio
Your outcomes
• Pay/benefits • Promotions
• Recognition • Workspace
• Interesting job
• Learning
Compare own
ratio with
other’s ratio
Your inputs
Other’s outcomes
• Pay/benefits • Promotions
• Recognition • Workspace
• Interesting job
• Learning
Other’s inputs
• Reputation
• Skill
• Hours
• Effort
• Performance • Experience
• Reputation
• Skill
• Hours
• Effort
• Performance • Experience
of equity or
Motivational Effects of Inequity Perceptions
Actions that reduce
inequity tension
(negative emotions)
have pointed out throughout this chapter, emotions are the
engines of motivation. In the case of inequity, people are
motivated to reduce the emotional tension. Most people have
a strong emotional response when they believe a situation is
unfair, and this emotion nags them until they take steps to
correct the perceived inequity.
There are several ways to try to reduce the inequity tension.93 Let’s consider each of these in the context of underreward inequity. One action is to reduce our inputs so the
outcome/ input ratio is similar to that of the higher-paid
co-worker. Some employees do this by working more
slowly, offering fewer suggestions, and engaging in less
organizational citizenship behaviour. A second action is to
increase our outcomes. Some people who think they are
underpaid ask for a pay raise. Others make unauthorized
Motivation to
reduce tension
• Change our inputs
• Change our outcomes
• Change other’s inputs
• Change other’s outcomes
• Change our perceptions
• Change comparison other
• Leave the field
use of company resources. A third behavioural response is
to increase the comparison other’s inputs. We might subtly
ask the better-paid co-worker to do a larger share of the
work, for instance. A fourth action is to reduce the comparison other’s outcomes. This might occur by ensuring
that the co-worker gets less desirable jobs or working conditions. Another action, although uncommon, is to ask the
company to reduce the co-worker’s pay so it is the same
as ours.
A fifth action involves changing our beliefs about the situation rather than changing our behaviour. For example, we
might believe that the co-worker really is providing more inputs
(e.g., working longer hours) for that higher pay. Alternatively,
we might change our perceived valence of some outcomes.
Rather than thinking that a co-worker’s work-related travel is
136 Part Two
Individual Behaviour and Processes
How sensitive are you to inequities? You can discover your level of equity sensitivity by completing
this self-assessment in Connect.
©John Lehmann/Globe and Mail/The Canadian Press
Melissa Leverrier earns a fixed hourly rate along with overtime pay as a Canada Post urban mail carrier in Chilliwack,
B.C. Sandee Saamanen does similar work as a Canada Post rural suburban mail carrier (RSMC) in nearby Agassiz. But
Saamanen does not receive overtime pay and her paycheque is determined by how many parcels she delivers, distance
travelled, and other performance criteria. An arbitrator recently concluded that this dual compensation system is unfair.
RSMCs receive significantly lower earnings than their urban counterparts for performing essentially the same work. “She
[Sandee Saamanen] has a different uniform than I, but honestly we’re all doing the same thing,” Leverrier complains.
Canada Post is now adjusting the RSMC pay rates. “It’s just another small step towards equality,” says Leverrier.*
*“Arbitrator Rules Wage Gap Exists between Rural, Urban Mail Carriers,” CBC News, June 1, 2018; N. Grossman, “Agassiz Postal Workers Join Canada Post
Strike, Push for Equality to Urban Carriers,” The Agassiz - Harrison Observer, October 29, 2018; “Retroactive Payments, Collection of Premiums to Appear
on Your October 17 Pay Statement” (Canada Post letter to RSMC employees, October 2019).
a desirable perk, we instead perceive most of that travel as an
undesirable nuisance. A sixth action to reduce the inequity
tension is to change the comparison other. Instead of comparing ourselves with the higher-paid co-worker, we might
increasingly compare with a friend or neighbour who works in
a similar job. Finally, if the inequity tension is strong enough
and can’t be reduced through other actions, we might leave the
field. This occurs by moving to another department, joining
another company, or keeping away from the work site where
the higher paid co-worker is located.
People who feel overreward inequity would reverse these
actions. Some overrewarded employees reduce their feelings
of inequity by working harder; others encourage the underrewarded co-worker to work at a more leisurely pace. A common
reaction, however, is that the overrewarded employee changes
their perceptions to justify the more favourable outcomes,
such as believing the assigned work is more difficult or their
skills are more valuable than the lower-paid co-worker’s skills.
As Pierre Berton, the popular late Canadian journalist, author,
and historian once said: “I was underpaid for the first half of
my life. I don’t mind being overpaid for the second half.”94
Evaluating Equity Theory
Equity theory is quite successful at understanding (usually
in hindsight) why people feel unfairly rewarded.95 However,
it is more difficult to use as a practical tool for predicting
and preventing inequity in the future. The main problem
is that people vary in their choice of comparison other and
which inputs or outcomes are most valuable. Therefore,
leaders need to minimize the risk of inequity feelings by
Chapter 5
knowing their employees well enough to understand their
priority of outcomes and inputs. Open communication is
also important because it lets decision makers know from
the employees affected whether they believe decisions are
unfair. A second problem is that equity theory accounts
for only some of our feelings of fairness in the workplace.
Procedural and interactional justice can be just as important
as distributive justice.
Procedural justice is the perception that appropriate rules
are applied in the procedures used throughout the course
of deciding the distribution of workplace benefits and burdens. Interactional justice is the perception that appropriate
rules are applied in the way the people involved are treated
throughout that decision process.96 Exhibit 5.10 lists the
main rules that people consider when determining procedural and interactional justice.
There are several ways to maintain procedural justice.97
Decision makers must be perceived as unbiased, without
self-interest in the results, and not blinded by narrow doctrines. Their allocation decisions need to be based on as
much relevant and accurate information as possible. Those
decisions also need to take into account the positions and
circumstances of the diverse groups affected by the outcomes. Another factor to consider in procedural justice is
whether the decision criteria and decision procedures are
compatible with ethical principles. For example, ­gathering
accurate information might not be fair if it involves closely
monitoring employees or violating their individual ­privacy.
The decision criteria used to allocate benefits as well as
Foundations of Employee Motivation 137
the procedural justice rules need to be applied consistently
to everyone (equality) and over time (stability).
Another important condition for procedural justice is that
employees are given “voice” in the process—they have the
opportunity to present their evidence and opinions to decision makers. Voice improves the quality of information
applied to the decision. It also provides a value-expressive
function; employees tend to feel better after having an opportunity to speak their mind. Lastly, employees should have
a right to appeal the decision (so it is reviewed and possibly overturned) if they believe there were errors in how
resources were distributed or flaws in the procedures leading
to that decision.
Interactional justice also depends on a set of rules that people believe are being applied to the situation.98 Two of these
rules—treating people with politeness and with respect—­
support the feeling of fairness in the interpersonal relationship.
Abusive supervision is a clear example of violation of these
interactional justice rules because employees are treated rudely
and their self-worth is attacked.99 To generate a sense of fairness regarding the information provided, employees should
receive thorough and well-justified explanations about the
decision, and honest, candid, and timely information about
the decision. For instance, people are more likely to feel that a
decision is unfair if decision makers refuse to explain how the
decision was made, or if they seem evasive in their explanation.
Consequences of Procedural and
Interactional Injustice
Employees who believe procedural or interactional justice
rules have been violated experience negative emotions, such
as anger, frustration, insult, resentment, and shame.100 How
employees direct the energy from these emotions depends
Procedural and interactional Justice Rules
Procedural justice rules
Interactional justice rules
• Decision makers are not biased by self-interest or restrictive doctrines.
• Employees are treated in a polite manner.
• Allocation decisions are based on a full complement of accurate
• Employees are treated with respect.
• Decision makers consider the interests of all groups affected by the
• Decisions and procedures are compatible with ethical principles.
• Decision criteria and procedures are applied consistently across
persons and over time.
• Employees have the opportunity to present their evidence and
opinions to decision makers (voice).
• Questionable decisions and procedures can be appealed and
• Employees receive thorough and well-justified explanations about
the decision.
• Employees receive honest, candid, and timely information about the
138 Part Two
Individual Behaviour and Processes
on their personal characteristics and experiences. Generally,
research has found that procedural or interactional injustice
often results in less work effort (and performance), fewer
organizational citizenship behaviours, less cooperation with
co-workers, increased involvement in union activities, and
increased turnover.
Victims of procedural and interactional injustice sometimes retaliate to restore their self-esteem, reinstate their
status and power in the relationship, and educate the perpetrator of the injustice.101 A related outcome is increased
aggression toward the decision maker (e.g., supervisor) and
sometimes toward co-workers who are seemingly treated
more favourably. Procedural or interactional injustice can
also lead to more extreme dysfunctional behaviours, such as
theft, sabotage, and violence.
Chapter Summary
Define employee motivation and engagement.
Motivation is defined as the forces within a person that affect
the direction, intensity, and persistence of voluntary behaviour.
Employee engagement is defined as an individual’s emotional and
cognitive (rational) motivation, particularly a focused, intense, persistent, and purposive effort toward work-related goals. Supporting
employee motivation and engagement is challenging because the
workforce is more diverse than ever before, and because organizations have reduced supervision and other traditional control
Explain how drives and emotions influence employee
Drives (also called primary needs) are neural states that energize
individuals to correct deficiencies or maintain an internal equilibrium. They generate emotions, which put us in a state of readiness
to act. Needs—goal-directed forces that people experience—are
shaped by the individual’s self-concept (including personality and
values), social norms, and past experience.
Discuss the employee motivation implications of four-drive
theory, Maslow’s needs hierarchy, intrinsic and extrinsic
motivation, and learned needs theory.
Four-drive theory states that emotions are the source of human
motivation. The drives to acquire, bond, comprehend, and defend
produce emotions, which become conscious needs. The employee’s
personal characteristics and experiences (mental skill set) direct
emotional energy to goals perceived to have a high probability of
fulfilling those felt needs. Four-drive theory’s two recommendations are that organizations should help employees fulfil all four
drives and that fulfilment of the four drives must be kept in balance.
Maslow’s needs hierarchy groups needs into a hierarchy of five
levels and states that the lowest needs are initially most important
but higher needs become more important as the lower ones are satisfied. Although very popular, the theory’s assumption that everyone has the same needs hierarchy lacks research support. Needs
hierarchies vary from one person to the next according to their
personal values. However, Maslow proposed more useful ways to
think about human motivation, specifically that motivation theories
need to be holistic, humanistic, and positive-oriented.
Intrinsic motivation refers to motivation controlled by the individual and experienced from the activity itself, whereas extrinsic
motivation occurs when people are motivated to receive something that is beyond their personal control for instrumental reasons.
Intrinsic motivation is anchored in the innate drives for competence
and autonomy. Some research suggests that extrinsic motivators
may reduce existing intrinsic motivation to some extent and under
some conditions, but the effect is often minimal.
McClelland’s learned needs theory argues that needs can be
strengthened through learning. The three needs studied in this
respect are need for achievement, need for power, and need for
Discuss the expectancy theory model, including its practical
Expectancy theory states that work effort is determined by the
perceived probability that a specific level of effort will produce a
specific level of performance (E-to-P expectancy), the perceived
probability that a specific behaviour or performance level will lead
to specific outcomes (P-to-O expectancy), and the valences the person ascribes to those outcomes. The E-to-P expectancy increases
by improving the employee’s ability and confidence to perform the
job. The P-to-O expectancy increases by measuring performance
accurately, distributing higher rewards to better performers, and
showing employees that rewards are performance-based. Outcome
valences increase by finding out what employees want and using
these resources as rewards.
Outline organizational behaviour modification (OB Mod) and
social cognitive theory, and explain their relevance to employee
Organizational behaviour modification takes the behaviourist view
that the environment teaches people to alter their behaviour so they
maximize positive consequences and minimize adverse consequences.
Antecedents are environmental stimuli that provoke (not necessarily cause) behaviour. Consequences are events following behaviour
that influence its future occurrence. Consequences include positive
Chapter 5
reinforcement, punishment, negative reinforcement, and extinction.
The schedules of reinforcement also influence behaviour.
Social cognitive theory states that much learning and motivation occurs by observing and modelling others as well as by anticipating the consequences of our behaviour. It suggests that people
typically infer (rather than only directly experience) cause–effect
relationships, anticipate the consequences of their actions, develop
self-efficacy in performing behaviour, exercise personal control
over their behaviour, and reflect on their direct experiences. The
theory emphasizes self-regulation of individual behaviour, including self-reinforcement, which is the tendency of people to reward
and punish themselves as a consequence of their actions.
Describe the characteristics of effective goal setting and
A goal is a cognitive representation of a desired end state that a person
is committed to attain, and goal setting is the process of motivating
employees and clarifying their role perceptions by establishing performance objectives. Goals are more effective when they are SMARTER
(specific, measurable, achievable, relevant, time-framed, exciting,
and reviewed). Effective feedback is specific, relevant, timely, credible, and sufficiently frequent. Strengths-based coaching maximizes
employees’ potential by focusing on their strengths rather than weaknesses. Strengths-based coaching tends to be effective because people are more receptive to information about their strengths rather than
flaws, and because a person’s motivation and ability becomes more
stable over time. Employees usually prefer nonsocial feedback sources
to learn about their progress toward goal accomplishment.
Foundations of Employee Motivation 139
Explain how equity theory, procedural justice, and interactional justice influence employee motivation.
Organizational justice exists in several forms, the main three of
which are distributive, procedural, and interactional. Distributive
justice refers to the perception that appropriate decision criteria
(rules) have been applied to calculate how various benefits and burdens are distributed. These rules relate to equality, need, or equity.
Equity theory has four elements: outcome–input ratio, comparison
other, equity evaluation, and consequences of inequity. The theory
also explains what people are motivated to do when they feel inequitably treated.
Procedural justice is the perception that appropriate procedural rules have been applied throughout the decision process.
These rules include that the decision maker is unbiased, considers the full complement of accurate information, considers
the interests of all groups affected, applies ethical principles,
applies decision criteria and procedural rules consistently, allows
employees to present their views, and allows appeal of decisions.
Interactional justice is the perception that appropriate rules have
been applied in the way employees are treated throughout the
decision process. These rules include that employees are treated
with respect and politely, that employees receive explanations
that are thorough and logical, and that they receive honest and
timely information about the decision. Lack of procedural and
interactional justice results in negative emotions (ranging from
anger to shame) as well as a variety of behaviours that harm the
organization (such as lower performance and higher incidence of
turnover, aggression, and theft).
Key Terms
distributive justice
employee engagement
equity theory
expectancy theory
extrinsic motivation
four-drive theory
interactional justice
intrinsic motivation
Maslow’s needs hierarchy theory
need for achievement (nAch)
need for affiliation (nAff)
need for power (nPow)
organizational behaviour modification (OB Mod)
procedural justice
social cognitive theory
strengths-based coaching
Critical Thinking Questions
1. Four-drive theory recommends that companies must
keep fulfilment of the four drives in balance. What is this
“balance” and why is it important? Give an example (real
or hypothetical) of how a company maintains balanced
drive fulfilment. Also describe a company that does not
provide this balance, including the consequences of this
imbalance on employees’ attitudes and behaviour.
2. Learned needs theory states that needs can be strengthened or weakened. How might a company strengthen the
achievement needs of its management team?
140 Part Two
Individual Behaviour and Processes
3. Everyone who works as an electronic game developer
has extrinsic sources of motivation, and most also experience some degree of intrinsic motivation. Considering
the dynamics of extrinsic and intrinsic motivation, what
should companies in this industry do to ensure that their
game developers are highly motivated at work?
4. The opening case study for this chapter describes how
many companies have shifted from traditional annual
performance appraisals to frequent, constructive, and
future-focused development reviews. Apply expectancy
theory to explain why the more frequent feedback and
more strengths-based future focus of the new performance review process might motivate employees more
than the traditional judgment-oriented, problem-focused,
annual performance appraisal process.
5. Describe a situation in which you used organizational
behaviour modification to increase or decrease someone’s motivation regarding a specific behaviour. What
specifically did you do? What was the result?
6. Using your knowledge of the characteristics of effective
goals, establish two meaningful goals related to your performance in this class.
7. Most people think they are “worth more” than they are
paid. Furthermore, most employees seem to feel that they
exhibit better leadership skills and interpersonal skills
than others. Please comment on this human tendency.
8. You are an external consultant hired by a large organization to investigate possible causes of employee perceptions of procedural and interactional injustice regarding
various management decisions (promotions, vacation
rostering, assigned tasks, office location, and so forth).
Many employees have complained that management
is unfair in how it makes these decisions. Even those
who say they get a fair deal in these decisions agree that
the process is suspicious and therefore subject to doubt
by those who receive less than they expected. In a few
instances, employees have also complained about the
information (or lack of information) they receive about
how the decision was justified, as well as how they have
been treated when trying to discuss the decision with
management. As an external consultant, identify specific
activities and issues you would investigate to pinpoint the
ways in which management can improve employee perceptions of procedural and interactional justice.
Case Study:
by Robert J. Oppenheimer, Concordia University
Purpose This exercise is designed to help you to understand expectancy theory and how its elements affect a person’s level of effort toward job performance.
Instructions This exercise may be completed either individually or in small teams of 4 or 5 people. When the individuals (or teams) have completed the exercise, the results
will be discussed and compared with others in the class.
Read the following interview case. Then calculate whether
Harry will engage in high or “just acceptable” performance
effort under the conditions described. Valence scores range
from –1.0 to + 1.0. All expectancies are probabilities ranging
from 0 (no chance) to 1.0 (definitely will occur). The effort
level scores are calculated by multiplying each valence by
the appropriate P-to-O expectancy, summing these results,
then multiplying the sum by the E-to-P expectancy.
Interviewer: Hi, Harry. I have been asked to talk to you
about your job. Do you mind if I ask you a few questions?
Harry: No, not at all.
Interviewer: Thanks, Harry. What are the things that you
would anticipate getting satisfaction from as a result of your
Harry: What do you mean?
Interviewer: Well, what is important to you with regard to
your job here?
Harry: I guess most important is job security. As a matter of
fact, I can’t think of anything that is more important to me.
I think getting a raise would be nice, and a promotion would
be even better.
Interviewer: Anything else that you think would be nice to
get, or for that matter, that you would want to avoid?
Harry: I certainly would not want my buddies to make fun
of me. We’re pretty friendly, and this is really important to
Interviewer: Anything else?
Harry: No, not really. That seems to be it.
Interviewer: How satisfied do you think you would be with
each of these?
Chapter 5
Harry: What do you mean?
Interviewer: Well, assume that something that you would
really like has a value of + 1.0 and something you would really
not like, that is you would want to avoid, has a value of − 1.0,
and something you are indifferent about has a value of 0.
Harry: OK. Getting a raise would have a value of .5; a promotion is more important, so I’d say .7; and having my buddies make fun of me, .9.
Interviewer: But, I thought you didn’t want your buddies to
make fun of you.
Harry: I don’t.
Interviewer: But you gave it a value of .9.
Harry: Oh, I guess it should be −.9.
Interviewer: OK, I just want to be sure I understand what
you’re saying. Harry, what do you think the chances are of
these things happening?
Harry: That depends.
Interviewer: On what?
Harry: On whether my performance is high or just
Interviewer: What if it is high?
Harry: I figure I stand about a 50–50 chance of getting
a raise and/or a promotion, but I also think that there is a
90 percent chance that my buddies will make fun of me.
Interviewer: What about job security?
Harry: I am certain my job is secure here, whether my performance is high or just acceptable. I can’t remember the last
Foundations of Employee Motivation 141
guy who was doing his job and got fired. But if my performance is just acceptable, my chances of a raise or promotion
are about 10 percent. However, then the guys will not make
fun of me. That I am certain about.
Interviewer: What is the likelihood of your performance
level being high?
Harry: That depends. If I work very hard and put out a high
degree of effort, I’d say that my chance of my performance
being high is about 90 percent. But if I put out a low level
of effort, you know—if I just take it easy—then I figure
that the chances of my doing an acceptable job is about
80 percent.
Interviewer: Well, which would you do: put out a low level
or a high level of effort?
Harry: With all the questions you asked me, you should be
able to tell me.
Interviewer: You may be right!
Harry: Yeah? That’s nice. Hey, if you don’t have any other
questions, I’d like to join the guys for coffee.
Interviewer: OK, thanks for your time.
Harry: You’re welcome.
Discussion Question
1. Use the expectancy theory model to predict Harry’s
motivation to achieve high or “just acceptable” performance in his job. Identify and discuss the factors that
influence this motivation.
Developed by Robert J. Oppenheimer, Ph.D. Professor of Management, Concordia University, Montreal, Canada.
Case Study:
By Steven L. McShane, University of Newcastle (Australia)
Barrie Super Subs is one of the larger takeout restaurants in
the Super Subs chain, which includes 300 locations across
Canada. This outlet has a restaurant manager, an assistant
manager, and several part-time team leaders. The restaurant manager rarely has time to serve customers, and head
office discourages them from performing front-line work.
The assistant manager serves customers for a couple of hours
during the busy lunchtime but otherwise assists the restaurant manager with purchasing, accounts, hiring, and other
operations. Most team leaders are college students and serve
customers alongside other employees, particularly from late
afternoon to night closing. Most employees are also students
who work part-time; a few are in high school. All regular
staff earn minimum pay rates.
Barrie Super Subs has experienced below average profitability over the past 18 months, which has reduced the
monthly bonus paid to the restaurant manager and assistant
manager. This bonus is calculated by percentage of “wastage”
(unsold, damaged, or unaccounted for food and drinks) relative to sales; the lower the percentage of wastage, the higher
the bonus. Wastage occurs when employees drop or spill food,
cut up more toppings than are sold, burn heated subs, prepare
an order incorrectly, and eat or give away food without permission. When employees make mistakes, the expense is supposed to come out of their paycheque. Unauthorized eating
and giving away food are grounds for immediate dismissal.
However, team leaders are reluctant to report any accidental
or deliberate wastage, even when confronted by the restaurant
142 Part Two
Individual Behaviour and Processes
manager about the store’s high wastage over the previous
week and month. One team leader who reported several accidental wastage incidents eventually quit after being snubbed
by co-workers who attended the same college classes.
Barrie Super Subs gives employees a food allowance if they
work continuously for at least four and a half hours. Staff complain that the allowance is meagre and that they are often ineligible for the food allowance because many shifts are only three
or four hours. Employees who work these shorter shifts sometimes help themselves to food and drinks when the managers
aren’t around, claiming that their hard work justifies the free
meal. Some also claim the food is a low company expense and
makes up for their small paycheque, relative to what many of
their friends earn elsewhere. Several (but not most) employees
give some of their friends generous helpings as well as occasional free soft drinks and chips. Employees say handing out
free food to friends makes them more popular with their peers.
Five months ago, the Barrie restaurant’s wastage (mainly
deliberate wastage) had risen to the point where the two managers no longer received a bonus. The restaurant manager
reacted by giving the food allowance only to those who work
for six or more hours in a single shift. This action excluded
even more staff from receiving the food allowance, but it did
not discourage employees from eating or giving away food.
However, almost 20 percent of the experienced college staff
left for other jobs over the following two months. Many
of those who stayed discouraged friends from considering
jobs at Super Subs. Morale declined, which dampened the
fun atmosphere that had existed to some extent in the past.
Relations between employees and managers soured further.
With relatively low unemployment, the restaurant manager found it difficult to hire replacements, particularly people with previous work experience of any kind. Temporary
staff shortages required the two managers to spend more
time working in food preparation and training new staff.
Their increased presence in the restaurant significantly
reduced deliberate wastage, but accidental wastage increased
somewhat as the greater number of inexperienced staff made
more mistakes.
After three months, Barrie Super Subs’ manager and assistant manager were confident that the situation had improved,
so they spent less time training staff and serving customers.
Indeed, they received a moderate bonus after the third month
in the store. However, wastage increased again soon after the
managers withdrew from daily operations. The experienced
employees started eating more food, and the new staff soon
joined in this practice. Exasperated, the restaurant manager
took bolder steps. He completely removed the food allowance and threatened to fire any employee caught consuming
or giving away food.
Wastage dropped somewhat over the next month but is
now creeping upward again.
Discussion Questions
1. What symptoms in this case suggest that something has
gone wrong?
2. What are the main causes of these symptoms?
3. What actions should Barrie Super Subs’ managers take
to correct these problems?
© 2011 Steven L. McShane. Inspired by an early case written by J.E. Dittrich and R.A. Zawacki.
Class Exercise:
Purpose This class exercise is designed to help you understand employee needs in the workplace.
to identify possible explanations for any variation of results
across students.
Instructions (Small Class)
Step 1: The table below lists in alphabetical order 16 characteristics of the job or work environment. Working alone,
use the far-left column to rank-order the importance of
these characteristics to you personally. Write in “1” beside
the most important characteristic, “2” for the second most
important, and so on through to “16” for the least important
characteristic on this list.
Step 3: The instructor will provide results of a recent
large-scale survey of younger Canadian postsecondary students (i.e., born in 1980 or since). When these results are
presented, discuss the reasons for any noticeable differences
between the survey and class rankings. Relate the differences
to your understanding of the emerging view of employee
needs and drives in work settings.
Step 2: Students are assigned to teams, where they compare
each other’s rank-order results. Note reasons for the largest
variations in rankings and be prepared to discuss these reasons with the entire class. Students should pay close attention to different needs, self-concepts, and various forms of
diversity (ethnicity, profession, age, etc.) within the class
Step 1: Same as above.
Instructions (Large Class)
Step 2: The instructor will ask students, by a show of hands
(or use of classroom technology), to identify their top-ranked
Step 3: Same as above.
Chapter 5
Foundations of Employee Motivation 143
Personal Ranking of Work-Related Attributes
Attributes of Work (Listed Alphabetically)
Your Ranking (1 = most important)
Challenging work
Commitment to social responsibility
Good health and benefits plan
Good initial salary level
Good people to report to
Good people to work with
Good training opportunities/developing new skills
Good variety of work
Job security
Opportunities for advancement in position
Opportunities to have a personal impact
Opportunities to have a social impact
Opportunity to travel
Organization is a leader in its field
Strong commitment to employee diversity
Work–life integration
Self-Assessments for Chapter 5
How strong are your growth needs?
Many human needs are called “deficiency” needs because they become active only when unfulfilled. However, Abraham Maslow popularized the idea that people also have “growth needs,”
which continue to motivate even when temporarily satiated. Growth needs are associated with
self-actualization and intrinsic motivation. People vary in their growth need strength, which
is evident from the type of work they prefer. This self-assessment estimates your growth need
How strong are your learned needs?
Everyone has the same innate drives, but these drives produce different need strengths due
to each person’s socialization and personality. David McClelland particularly examined three
learned needs, two of which are measured in this self-assessment. This self-assessment estimates
the strength of these learned needs in you.
What is your goal orientation?
Everyone sets goals for themselves, but people differ in the nature of those goals. Some view
goals as challenges that assist learning. Others see goals as demonstrations of one’s competence.
Still others view goals as threatening one’s image if they are not achieved. This self-assessment
estimates your dominant goal orientation.
How sensitive are you to inequities?
Correcting feelings of inequity is one of the most powerful motivating forces in the workplace.
But people react differently to equitable and inequitable situations based on their equity sensitivity. Equity sensitivity refers to a person’s outcome/input preferences and reaction to various
outcome/input ratios when compared to other people. This self-assessment estimates your level
of equity sensitivity.
Applied Performance Practices
After reading this chapter, you should be able to:
LO1 Discuss the meaning of money and identify several individual, team, and
organizational-level performance-based rewards.
LO2 Describe five ways to improve reward effectiveness.
LO3 List the advantages and disadvantages of job specialization.
LO4 Diagram the job characteristics model and describe three ways to improve
employee motivation through job design.
LO5 Define psychological empowerment and identify strategies that support
LO6 Describe the five elements of self-leadership and identify specific personal and
work environment influences on self-leadership.
When Cathy Thorpe became the first externally
hired CEO of Nurse Next Door, she discovered
how to further empower its franchisees and their
employees. By removing middle management,
performance reviews, and other forms of centralized control, the Vancouver-based home care services company enriched franchise-level jobs with
more autonomy and felt responsibility.
“We don’t need middle managers to manage
people,” Thorpe explains. “It was starting to affect
Vancouver-based Nurse Next Door has thrived through
[franchisee and employee] performance because
a period of hyper growth by applying job enrichment,
they were complacent with waiting for direction
empowerment, and self-leadership practices.
from us instead of being proactive.”
©AP Photo/Chris Carlson/The Canadian Press
Accountability accompanies autonomy. So, with
further training of franchisees and their employees, Nurse Next Door made self-leadership a central element of its culture. “We set our people up for
success and also encourage a culture of self-leadership,” says Tiffany Rubin, owner of one of Nurse Next
Door’s largest franchises in the United States.
Cathy Thorpe emphasizes that everyone needs to be able to manage themselves to support Nurse
Next Door’s hyper growth (it is currently among Canada’s fastest growing companies). “We introduced a
concept of self-leadership to help everyone slow down by empowering our people to make decisions, to
be passionate, purposeful and mindful — to be self-led,” she says. “We need everyone in our organization
to hone these skills and take personal and professional accountability.”
Chapter Six
Applied Performance Practices 145
Nurse Next Door has thrived through a culture of autonomy and self-leadership, but franchise owner
Tiffany Rubin warns that “if you require complete structure, this may not be the best environment for you.”
Cathy Thorpe agrees that self-leadership isn’t suitable in situations where “people feel comfortable being
told what to do and some leaders don’t feel comfortable leading less.” She sums up the company’s model
of success: “At Nurse Next Door, we are empowering our people to own their role and to have the space
they need to do their job. No micromanaging, no tiered hierarchies.”1
Nurse Next Door is one of Canada’s fastest growing companies because its employees are motivated by enriched jobs,
an empowering work environment, and a culture that encourages self-leadership practices. All three topics are discussed
in this chapter, along with financial rewards.
The chapter begins by examining the meaning of money.
This is followed by an overview of financial reward practices,
including the different types of rewards and how to implement
rewards effectively. Next, we look at the conceptual foundations of job design, followed by specific job design strategies
for motivating employees. We then consider the elements of
empowerment, as well as conditions that support empowerment. The final part of the chapter explains how employees
manage their own performance through self-leadership.
The Meaning of Money in the
Rewarding people with money is one of the oldest applied
performance practices, and is certainly the most widespread.
At the most basic level, money and other financial rewards
represent a form of exchange; employees provide their
labour, skill, and knowledge in return for money and benefits from the organization. From this perspective, money and
related rewards align employee goals with organizational
goals. This concept of economic exchange can be found
across most societies. The word for pay in Malaysian and
Slovak means “to replace a loss”; in Hebrew and Swedish it
means “making equal.”2
However, money is much more than a form of compensation for an employee’s contribution to organizational
objectives. Money relates to our needs, our emotions, and
our self-concept. It is a symbol of achievement and status,
a motivator, a source of enhanced or reduced anxiety, and
an influence on our propensity to make ethical or risky
decisions. It also generates a variety of emotions, some of
which are negative (anxiety, depression, anger, helplessness,
etc.).3 Furthermore, money influences human thoughts and
behaviour nonconsciously to some extent.4 According to one
expert, “Money is probably the most emotionally meaningful
object in contemporary life.”5
The meaning of money varies considerably from one
person to the next. Some people value it as an instrument
for acquiring other things of value; others value money for
its own sake. A widely studied model of money attitudes
suggests that people have a strong “money ethic” or “monetary intelligence” when they believe that money is not evil,
that it is a symbol of achievement, respect, and power, and
that it should be budgeted carefully. These attitudes toward
money influence an individual’s ethical conduct, organizational citizenship, and many other behaviours and attitudes.6
Do men and women have different perceptions and attitudes toward money? Apparently so, according to several
studies.7 In almost all societies, men attach more importance
or value to money than do women. Men are more likely than
women to view money as a symbol of power and status as
well as the means to autonomy. Women are more likely to
view money in terms of things for which it can be exchanged
and particularly as a symbol of generosity and caring by
using it to buy things for others.
The meaning of money also varies across cultures.8 People
in China, Japan, and other countries with high power distance
(acceptance of unequal distribution of power in a society—see
Chapter 2) tend to have a high respect and priority for money,
whereas people in countries with a strong egalitarian culture
(such as Denmark, Austria, and Israel) are discouraged from
openly talking about money or displaying their personal wealth.
One study suggests that Swiss culture values saving money
whereas Italian culture places more value on spending it.
The motivational effect of money is much greater than
was previously believed, and this effect is due more to its
symbolic value than to what it can buy.9 Philosopher John
Stuart Mill made this observation almost 150 years ago when
he wrote: “The love of money is not only one of the strongest
What is your attitude toward money? You can discover your attitude toward money by completing
this self-assessment in Connect.
146 Part Two
Individual Behaviour and Processes
moving forces of human life, but money is, in many cases,
desired in and for itself.”10 People who earn higher pay tend
to have higher job performance because the higher paycheque enhances their self-concept evaluation. Others have
noted that the symbolic value of money depends on how it is
distributed in the organization and how many people receive
that financial reward.
Overall, current organizational behaviour thinking indicates that money is much more than a means of exchange
between employer and employee. It fulfils a variety of
needs, influences emotions, and shapes or represents a person’s self-concept. These findings are important to remember when the employer is distributing financial rewards in
the workplace. Over the next few pages, we look at various
reward practices and how to improve the implementation of
performance-based rewards.
Financial Reward Practices
Financial rewards come in many forms, which can be
organized into the four specific objectives identified in
Exhibit 6.1: membership and seniority, job status, competencies, and performance.
Membership-based and seniority-based rewards (sometimes
called “pay for pulse”) represent the largest part of most paycheques. Some employee benefits are provided equally to
everyone, such as free or subsidized meals during work. Other
rewards increase with seniority. For example, employees with
10 or more years of service at the Paul Scherrer Institute near
Zurich, Switzerland, receive an annual loyalty bonus equal
to half a month’s salary; those with 20 or more years of service at the natural and engineering sciences research centre
receive a bonus equal to a full month’s salary.11
These membership- and seniority-based rewards potentially reduce turnover and attract job applicants, particularly
those who desire predictable income. However, they do not
directly motivate job performance; on the contrary, they discourage poor performers from seeking work better suited to
Reward Objectives, Advantages, and Disadvantages
Reward objective
Sample rewards
Membership/ seniority
• Fixed pay
• May attract applicants
• Most employee benefits
• Minimizes stress of insecurity
• Doesn’t directly motivate
• Paid time off
• Reduces turnover
• May discourage poor performers
from leaving
• “Golden handcuffs” may undermine
Job status
• Promotion-based pay
• Status-based benefits
• Tries to maintain internal
• Minimizes pay discrimination
• Motivates employees to
compete for promotions
• Pay increase based on
• Skill-based pay
Task performance
• Improves workforce flexibility
• Tends to improve quality
Motivates career development
• Encourages hierarchy, which
may increase costs and reduce
• Reinforces status differences
• Motivates job competition and
exaggerated job worth
• Relies on subjective measurement of
• Skill-based pay plans are expensive
• Commissions
• Motivates task performance
• May weaken intrinsic motivation
• Merit pay
• Attracts performance-oriented
• May distance reward giver from
• Gainsharing
• Profit sharing
• Share options
• Organizational rewards create
an ownership culture
• Pay variability may avoid
layoffs during downturns
• May discourage creativity
• Tends to address symptoms, not
underlying causes of behaviour
Chapter Six
their abilities. Instead, the good performers are more easily
lured to better-paying jobs. Some of these rewards are also
“golden handcuffs”—they discourage employees from quitting because of deferred bonuses or generous benefits that
are not available elsewhere. The problem is that golden
handcuffs potentially weaken job performance because they
generate continuance rather than affective commitment (see
Chapter 4).
Almost every organization rewards employees to some extent
on the basis of the status or worth of the jobs they occupy.
In some parts of the world, companies measure job worth
through job evaluation. Most job evaluation methods give
higher value to jobs that require more skill and effort, have
more responsibility, and have
job evaluation Systematically
more difficult working conrating the worth of jobs within
ditions.12 The higher worth
an organization by measurassigned to a job, the higher
ing their required skill, effort,
the minimum and maximum
responsibility, and working
pay for people in that job.
Along with receiving higher
pay, employees with more valued jobs sometimes receive
larger offices, company-paid vehicles, and other perks.
Job status-based rewards try to improve feelings of fairness by distributing more pay to people in higher-valued
jobs. These rewards also motivate employees to compete for
promotions. However, at a time when companies are trying
to be more cost-efficient and responsive to the external environment, job status-based rewards potentially do the opposite by encouraging a bureaucratic hierarchy. These rewards
also reinforce a status mentality, whereas Millennial employees expect a more egalitarian workplace. Furthermore, status-based pay potentially motivates employees to compete
with each other for higher-status jobs, to exaggerate their job
duties, and to hoard resources as ways to increase the worth
of their current job.13
In recent years, many companies have shifted reward priorities to skills, knowledge, and other personal characteristics that lead to superior performance. The two main reward
practices in this category are competency-based pay structures and skill-based pay structures.
Competency-based pay structures identify clusters of
skills, knowledge, and experience specific to each broad
job group as well as clusters relevant across all job groups.
Employees progress through the pay range within their job
group as they demonstrate higher levels of those competencies.14 For example, the pay system at one mid-sized power
Applied Performance Practices 147
company lists accountability, technical competency, and a
few other skills relevant to everyone in the organization. Each
of the company’s four broad organizational levels also has a
specific set of competencies. For instance, technical acumen
and team skills are two skill sets that influence pay among
employees in the technical/professional job group, whereas
strategic thinking and managing stakeholders are two competencies specific to the executive group. Employees within
each job group receive higher pay as they demonstrate better
skills, knowledge, and experience for the organization-wide
and job group–specific competencies.15
Skill-based pay structures are more measurable competency-based reward systems in which employees receive
higher pay based on how quickly or accurately they perform
specific tasks and operate equipment.16 High Liner Foods,
the Nova Scotia–based frozen seafood company, assigns pay
rates to employees based on the number and difficulty of
skills they have mastered. “We’re setting our sites up for a
skill-based pay system, so as employees learn and demonstrate certain skills, they move into a different pay bracket,”
explains a High Liner executive.
Competency-based rewards motivate employees to learn
new skills.17 This tends to support a more flexible workforce,
increase employee creativity, and allow employees to be
more adaptive to new practices in a dynamic environment.
Product or service quality also tends to improve because
employees with multiple skills are more likely to understand
the work process and know how to improve it.
However, competency-based pay plans have not always
worked out as well as promised by their advocates. They
are often over-designed, making it difficult to communicate
these pay systems to employees. Competency definitions
tend to be abstract, which raises questions about fairness
when employers are relying on these definitions to award pay
increases. Skill-based pay systems measure specific skills, so
they are usually more objective. However, they are expensive
because employees spend more time learning new tasks.18
Performance-based rewards have existed for more than
4,000 years, since shepherds and other workers during
the Third Dynasty of Ur (located in modern-day Iraq) had
strict performance standards and received harsh penalties
if their output (number of sheep delivered) fell short of
those standards. Hundreds of years later, the most productive
weavers in ancient Babylon received higher payment (in
food) than co-workers with lower productivity.19 Today, performance-based rewards exist in many forms across most
cultures. Here is an overview of some of the most popular
individual, team, and organizational performance-based
148 Part Two
Individual Behaviour and Processes
Global Connections 6.1
Wonderful Company is the parent company of the world’s
largest flower delivery service (Teleflora), the world’s largest grower of tree nuts, the largest citrus grower in
North America, and other diversified businesses. These
operations require employees who are motivated and
rewarded for developing valuable skills, so Wonderful
Co. has introduced a skill-based reward system for production staff.
Employees are assigned to skill blocks, such as
Operator 5 and Mechanical 1. These pay groups have
clearly defined skills as well as pathways to higher skill
blocks. As an example, an employee in the Mechanical
1 block needs to know how to operate the correction
tensioning tool, calculate chain deflection for each
system, demonstrate the correct use of an Accu-Glide
conveyor service, and so forth.
Higher pay rates are earned as the employee
demonstrates mastery of skills in the next skill block. If
someone in a general operator job wants to enter the
refrigeration technician skill group, they would begin
by learning the specific skills in the Mechanical 1 skill
block. The employee would receive a higher pay rate
after measurable demonstration of those skills.
©imageBROKER/Alamy Stock Photo
The employee would next learn skills associated with
Mechanical 2 skill block and receive a higher pay rate
when these are mastered. Electrical 1 and other skill blocks
are also part of the refrigeration technician skill group,
which the employee could also learn over time.
* Based on information in: G. Simonoff and B. Kazar, “Build and Benefit from a Skill-Based Pay System,” Plant Services, August 16, 2018.
Individual Rewards
Many employees receive individual bonuses or other rewards
for accomplishing a specific task or exceeding annual performance goals. The referral bonus—which is paid when a
friend is hired by the company —is one of the most common individual bonuses for non-executive staff in Canada.
Housekeeping staff in many hotels are paid a piece rate—a
specific amount earned for each room cleaned.20 Other
hotels pay an hourly rate plus a per-room bonus. Real estate
agents and other salespeople typically earn commissions, in
which their pay depends on the sales volume they generate.
Team Rewards
Organizations have shifted their focus from individuals to
teams, and accompanying this transition has been the introduction of more team-based rewards. Nucor Corp. relies
heavily on team-based rewards. The American steelmaker’s employees earn bonuses that can exceed half their total
pay, determined by how much steel is produced by the team.
This team-based bonus system also includes penalties. If employees catch a bad batch of steel before it leaves the mini-mill, they
lose their bonus for that shipment. But if a bad batch makes its
way to the customer, the team loses three times its usual bonus.21
Another form of team-based performance reward is
the gainsharing plan, which calculates bonuses from the
department’s or business unit’s cost savings and productivity
improvement. Gainsharing
gainsharing plan A teamplans tend to improve team
based reward that calculates
dynamics, knowledge sharbonuses from the work unit’s
ing, and pay satisfaction.
cost savings and productivity
They also create a reasonimprovement.
ably strong link between
effort and performance because much of the cost reduction
and labour efficiency is within the team’s control.22
One division of BC Hydro has a gainsharing arrangement
in which employees can earn up to 5 percent beyond their
base pay when they collectively achieve or exceed a combination of company, business unit, and departmental target
goals. Canadian mining and forestry companies have had
Chapter Six
Applied Performance Practices 149
Global Variations in Performance-Based Pay*
Scores represent the average number of individual pay-for-performance (I-PFP) practices used by each company surveyed within the specified
country. The I-PFP include such practices as using performance-based rewards, using performance appraisals to make pay decisions, etc. The study
surveyed 4,207 companies (minimum 100 employees) in 27 countries. This exhibit displays a sample across the range of the countries studied.
* Based on data reported in: P. Gooderham et al., “A Multilevel Analysis of the Use of Individual Pay-for-Performance Systems,” Journal of Management 44, no. 4
(2018): 1479–1504, https://doi.org/10.1177/0149206315610634. Data were collected in 2009–2010. These results are moderately similar to a 2013 global survey sponsored by Kelly Services.
gainsharing plans over the years, but the number that are still
active is unknown. Some hospitals in the United States have
cautiously introduced a form of gainsharing, whereby physicians and medical staff in a medical unit (cardiology, orthopedics, etc.) are collectively rewarded for cost reductions in
surgery and patient care. A recent Canadian report suggests
that hospitals in this country are unlikely to introduce gainsharing incentives due to the way that hospitals are funded.23
Organizational Rewards
Along with individual and team-based rewards, many firms
motivate employees with organizational-level rewards. Many
businesses distribute bonuses to all employees for achieving
preset organizational goals or as a companywide (rather than
team-based) variation of a gainsharing plan.
Hilcorp Energy Company is one example. The U.S. oil and
gas firm pays annual bonuses determined by the company’s production rate, midstream income, reserves, and operating costs.
“The annual bonus payout is up to 60 percent of salary and is
the same number for every employee—no team component,
no individual component—one number for the entire organization,” explains CEO Greg Lalicker. Another unique organizational reward is the “economic stability dividend” negotiated
by the British Columbia provincial government. B.C. government employees receive a negotiated pay increase, but a further
increase will occur if the province’s economic growth exceeds
the rate projected by an independent panel. In a recent fouryear period, this organization-wide reward has given B.C. government employees pay increases totalling almost 2 percent
beyond their fixed 5.5 percent wage increases.24
150 Part Two
Individual Behaviour and Processes
©Helen H. Richardson/Getty Images
As Canada’s largest contractor (and eighth largest in the United States), PCL Construction motivates employees through
their involvement in amazing projects and the associated learning opportunities. But the Edmonton-based company
is also owned by 90 percent of its salaried employees, creating a further incentive to contribute to the organization’s
success. “I’ve seen in other places where people will do their job and leave,” says Amrit Virk, a PCL engineer in
Richmond, B.C. “Here [at PCL], everyone has a stake in my performance, as well as their own.” Another PCL employee
explains that “being an employee at PCL as well as being a partial owner of PCL has a compounding effect on the bottom
line. Overall PCL success results in a higher dividend for partial owners like me and the people working here.”*
* J. Goodman, “Top Construction Execs Reveal Challenges, Opportunities,” Construction Dive, May 30, 2019; R. Yerema and K. Leung, “Top Employer: PCL
Construction,” Canada’s Top 100 (2020) (blog), November 21, 2019, https://reviews.canadastop100.com/top-employer-pcl; The quotation from the anonymous employee is from Glassdoor site for PCL Construction, accessed January 5, 2020.
Employee share ownership plans (ESOPs) are organizational rewards that encourage employees to buy company stock, usually at a
employee share ownership
discounted price. Some
plans (ESOPs) A reward
companies, such as PCL
system that encourages
Construction, are owned
employees to buy company
entirely by employees.
But motivation exists even
where employees own only some shares in the company
because the financial reward of ESOPs occurs in the form of
dividends and market appreciation of the shares.
While ESOPs involve purchasing company shares, share
options give employees the
share options A reward sysright to purchase company
tem that gives employees the
shares at a predetermined
right to purchase company
price up to a fixed expishares at a future date at a
ration date. Here’s how
predetermined price.
share options work: The
company might offer its employees the right to purchase
100 shares at $50 per share at any time between two and six
years from now. If the share price is, say, $60 two years later,
employees could earn $10 from these options, or they could
wait up to six years for the share price to rise further. If the
share price never rises above $50 during that time, employees are “out of the money,” so they would just let the options
expire. The intention of share options is to motivate employees to make the company more profitable, thereby raising the
company’s share price and enabling them to reap the value
above the predetermined price of the share options.
Another type of organizational-level reward is the
profit-sharing plan, in
profit-sharing plan A reward
which employees receive
system that pays bonuses to
a percentage of the preemployees on the basis of the
vious year’s company
previous year’s level of corpoprofits. Lee Valley Tools,
rate profits.
the iconic Ottawa-based
Chapter Six
Applied Performance Practices 151
manufacturer and retailer of quality woodworking and gardening tools, distributes 25 percent of its annual profits to
its 850 employees, with the CEO receiving the same amount
of profit-sharing bonus as the lowest-paid employee. Hydro
Quebec distributes approximately 1 percent of its net profits
to a large percentage of its employees. Most goes to 1,500
managers and executives, but engineers and other professionals also receive some of the bonus, calculated as a percentage of their base salary.25
companies are more likely to have performance-based (or
competency-based) rewards, which is consistent with evidence that these rewards are an important factor in human
capital development (see Chapter 1).31 Reward systems do
motivate most employees, but only under the right conditions. Here are some of the more important strategies for
improving reward effectiveness.
Evaluating Organizational-Level Rewards
Organizational behaviour modification theory and expectancy theory (Chapter 5) both recommend that employees
with better performance should be rewarded more than those
with poorer performance. Unfortunately, this simple principle seems to be unusually difficult to apply. Few employees see a relationship between job performance and the
amount of pay they and their co-workers receive. One survey
reported that only 42 percent of employees globally say they
think there is a clear link between their job performance and
pay. Only 25 percent of Swedish employees and 36 percent
of American employees see a pay–performance link. Even
employers are doubtful that their pay systems work: only
32 percent of mid-sized Canadian and American employers
believe their formal performance pay system actually differentiates pay based on employee performance.32
How can companies improve the pay–performance linkage? Inconsistencies and bias can be minimized through
gainsharing, ESOPs, and other plans that use objective
performance measures. Where subjective measures of performance are necessary, companies should rely on multiple sources of information. Companies also need to apply
rewards soon after the performance occurs, and in a largeenough dose (such as a bonus rather than a pay increase), so
employees experience positive emotions when they receive
the reward.33
How effective are organizational-level rewards? Research
indicates that ESOPs and share options tend to create an
ownership culture in which employees feel aligned with
the organization’s success.26 They may also increase firm
performance under some circumstances, but the effects are
modest.27 Profit sharing and organization-wide productivity
bonuses are also associated with improved productivity, but
their effectiveness depends on industry, bonus complexity,
and other factors.28 Profit sharing also has the advantage of
automatically adjusting employee compensation with the
firm’s prosperity, thereby reducing the need for layoffs or
negotiated pay reductions during recessions.
One reason why organizational rewards don’t improve
motivation or performance very much is that employees
perceive a weak connection between their individual effort
and the determinants of those rewards (i.e., corporate profits or share price). Even in small firms, the company’s share
price or profitability are influenced by economic conditions,
competition, and other factors beyond the employee’s immediate control. This low individual performance-to-outcome
expectancy suppresses the incentive’s motivational effect.
However, a few studies have found that ESOPs and other
organizational rewards have a more robust influence on
motivation and firm performance when employees are also
involved in organizational decisions.29 We discuss employee
involvement in the next chapter (Chapter 7).
Improving Reward Effectiveness
Performance-based rewards have come under attack for discouraging creativity, distancing management from employees, distracting employees from the meaningfulness of
the work itself, and being quick fixes that ignore the true
causes of poor performance. Studies have even reported
that the heightened stress created by very large rewards
can reduce, rather than increase, performance.30 Although
these issues have kernels of truth under specific circumstances, they do not necessarily mean that we should abandon performance-based pay. On the contrary, top-performing
Companies need to align rewards with performance within
the employee’s control. The more employees see a “line of
sight” between their daily actions and the reward, the more
they are motivated to improve performance. “We call it
return on controllable assets,” explains Michael Kneeland,
chairman and former CEO of United Rentals. Bonuses at the
world’s largest equipment rental company are determined by
how profitably United managers take care of assets within
their control. Higher-level managers earn bonuses based
more on overall fleet performance, whereas branch managers are rewarded more for parts and inventory efficiencies at
their local operations. “These are things within their control
that they are assessed on,” says Kneeland.34 Reward systems
152 Part Two
Individual Behaviour and Processes
Global Connections 6.2
For many years, the paycheques of almost all public
transit bus drivers in Santiago, Chile, were determined
by the number of fare-paying passengers. This incentive motivated the drivers to begin their route on time,
take shorter breaks, drive efficiently, and ensure that
passengers paid their fare.
But the drivers’ reward system also had horrendous
unintended consequences. To take on more passengers, bus drivers aggressively raced with competing
buses to the next passenger waiting area, sometimes
cutting off each other and risking the safety of people
in nearby vehicles. Drivers reduced time at each stop
by speeding off before passengers were safely on
board. They also left the bus doors open, resulting in
many passenger injuries and fatalities. Some drivers
drove past waiting areas if there was only one person
waiting and completely skipped stops with schoolchildren because those passengers paid only one-third of
the regular fare. Studies reported that Santiago’s transit
buses caused one fatal accident every three days, and
that drivers paid per passenger caused twice as many
traffic accidents as drivers paid per hour.
Santiago later integrated its public transit system and
drivers afterwards earned only hourly pay. Unfortunately,
©David R. Frazier Photolibrary, Inc./Alamy Stock Photo
under this reward system drivers were no longer motivated to ensure that passengers pay the fare (about
one-third are freeloaders), and some skipped passenger
stops altogether when they were behind schedule or at
the end of their workday. Santiago recently changed
driver pay once again, instituting a combination of fixed
pay and bonuses determined by several performance
indicators and reduced fare evasion.
* I. Tiznado et al., “Incentive Schemes for Bus Drivers: The Case of the Public Transit System in Santiago, Chile,” Research in Transportation Economics 48
(2014): 77–83; R.M. Johnson, D.H. Reiley, and J.C. Muñoz, “‘The War for the Fare’: How Driver Compensation Affects Bus System Performance,” Economic
Inquiry 53, no. 3 (2015): 1401–19.
also need to correct for situational factors. Salespeople in
one region may have higher sales because the economy is
stronger there than elsewhere, so sales bonuses need to be
adjusted for such economic factors.
Team rewards are better than individual rewards when
employees work in highly interdependent jobs because it
is difficult to measure individual performance in these situations. Nucor Corp. relies on team-based bonuses for this
reason; producing steel is a team effort, so employees earn
bonuses based on team performance. Team rewards also
encourage cooperation, which is more important when work
is highly interdependent. Employees also favour team-based
work when rewards are determined by team performance.
One concern, however, is that employees (particularly the
most productive employees) in Canada and many other
low-collectivism cultures prefer rewards based on their individual performance rather than team performance.35
It seems obvious that rewards work best when they are valued. Yet companies sometimes make false assumptions
about what employees want, with unfortunate consequences.
For instance, a manager at one Canadian firm honoured
an employee’s 25th year of service by buying her a box of
Timbits to be shared with other staff. The employee was
insulted. She privately complained later to co-workers that
she would rather receive nothing than “a piddling box of
doughnuts.”36 The solution, of course, is to ask employees
what they value. Campbell Soup did this several years ago
at its Canadian distribution centres. Executives thought the
employees would ask for more money in a special team
Chapter Six
reward program. Instead, distribution staff said the most
valued reward was a leather jacket with the Campbell Soup
logo on the back. The leather jackets cost much less, yet were
worth much more than the financial bonus the company had
intended to distribute.37
Performance-based reward systems sometimes have an unexpected—and undesirable—effect on employee behaviours.38
Many companies have discovered that rewarding employees
for how much they produce results in lower quality and more
product defects. Employees who work mainly on piece-rate
pay experience worse physical and emotional health than
employees in similar jobs who earn hourly pay.
Unusual reward systems can sometimes have equally
unusual unintended consequences. Consider the following
example: A food processing plant discovered that insect
parts were somehow getting into the frozen peas during processing. To solve this serious problem, management decided
to reward production staff for any insect parts they found in
the peas. The incentive worked! Employees found hundreds
of insect parts that they dutifully turned in for the bonus. The
problem was that many of these insect pieces came from
the employees’ backyards, not from the production line.39
Avoiding unintended consequences of rewards isn’t easy, but
these risks can be minimized by carefully thinking through
what the rewards will actually motivate people to do and,
where possible, testing the incentives in a pilot project before
applying them across the organization.
Financial rewards come in many forms and, as mentioned
at the outset of this section, they influence employees in
complex ways. But money isn’t the only thing that motivates people to join an organization and perform effectively.
Employees are usually much more engaged in their work
through intrinsic rather than extrinsic sources of motivation.
As we discussed in Chapter 5, intrinsic motivation is controlled by the individual and experienced from the activity
itself. In other words, companies motivate employees mainly
by designing interesting and challenging jobs, which is the
topic we discuss next.
Job Design Practices
How do you build a better job? That question has challenged
organizational behaviour experts, psychologists, engineers,
and economists for a few centuries. Some jobs have very
few tasks and usually require very little skill. Other jobs are
immensely complex and require years of experience and
Applied Performance Practices 153
learning to master them. From one extreme to the other, jobs
have different effects on work efficiency and employee motivation. The ideal, at least from the organization’s perspective,
is to find the right combination so that work is performed
efficiently but employees are engaged and satisfied.40 Job
design—the process of assigning tasks to a job, including
the interdependency of those tasks with other jobs—tries to
balance these potentially competing effects of efficiency and
motivation. To understand this issue more fully, we’ll begin
by describing early job design efforts aimed at increasing
work efficiency through job specialization.
By any measure, supermarket cashiers have highly repetitive
work. One consulting firm estimated that cashiers should be
able to scan each item in an average of 4.6 seconds. Cashiers
at five British supermarket chains took between 1.75 and
3.25 seconds to scan each item from a standardized list of
20 products. Along with scanning, cashiers process the payment, move the divider stick, and (in some stores) bag the
checked groceries.41
Supermarket cashiers perform jobs with a high degree
of job specialization. Job specialization occurs when the
work required to serve a
customer—or provide any
job specialization The result
other product or service—
of division of labour in which
is subdivided into separate
work is subdivided into separate jobs assigned to different
jobs assigned to differpeople.
ent people. For instance,
supermarkets have separate
jobs for checking out customers, stocking shelves, preparing
fresh foods, and so forth. Except in the smallest family grocery stores, one person would not perform all of these tasks
as part of one job. Each resulting job includes a narrow subset of tasks, usually completed in a short cycle time. Cycle
time is the time required to complete the task before starting
over with another item or client. Supermarket cashiers have
a cycle time of about 4 seconds to scan each item before they
repeat the activity with the next item. They also have a cycle
time for serving each customer, which works out to somewhere between 20 and 40 times per hour in busy stores.
Why would companies divide work into such tiny bits?
The simple answer is that job specialization potentially
improves work efficiency. It does so in four ways:
• Fewer skills and less knowledge to learn. Employees can
master specialized jobs more quickly because there are
fewer physical and mental skills and knowledge to learn and
therefore less time required to become proficient in the job.
• More frequent practice. More specialized jobs typically have shorter cycle times. Shorter task cycles give
154 Part Two
Individual Behaviour and Processes
Global Connections 6.3
The Arsenal of Venice introduced job specialization
in the sixteenth century—200 years before economist
Adam Smith famously praised this form of job design.
Founded in 1104 CE, the state-owned shipbuilder in
Italy eventually employed up to 4,000 people in specialized jobs (carpenters, iron workers, warehouse supervisors, etc.) to build ships and accessories (e.g., ropes).
In 1570, the Arsenal had become so efficient through
specialization that it built and outfitted 100 ships in two
months. The organization even had an assembly line along
the waterway where workers apportioned food, ammunition, and other supplies from specially designed warehouses to the newly-built vessels as they travelled past.
©PAINTING/Alamy Stock Photo
* R.C. Davis, “Arsenal and Arsenalotti: Workplace and Community in Seventeenth-Century Venice,” in The Workplace before the Factory, ed. T.M. Safley and
L.N. Rosenband (Ithaca, NY: Cornell University Press, 1993), 180–203; R. Crowley, “Arsenal of Venice: World’s First Weapons Factory,” Military History, March
2011, 62–70.
employees more frequent practice with the task, so jobs
are mastered more quickly.
• Less attention residue from changing tasks. Employees
experience “attention residue” after they change from one
type of task to another. Specifically, their mental attention
lingers on the previous type of work, which slows down
performance on the new task. Specialized jobs have fewer
and less varied tasks, so there is less changeover and, consequently, less attention residue and productivity loss.42
• Better person–job matching. Job specialization tends to
increase work efficiency by enabling employers to more
precisely match employees with specific aptitudes, skills,
knowledge, interests, and other characteristics to the jobs
for which these talents are best suited.43
The benefits of job specialization were noted more than
2,300 years ago by the Chinese philosopher Mencius and the
Greek philosopher Plato. Scottish economist Adam Smith
wrote 250 years ago about the advantages of job specialization.
Smith described a small factory where 10 pin makers collectively produced as many as 48,000 pins per day because they
performed specialized tasks. One person straightened the metal,
another cut it, another sharpened one end of the cut piece, yet
another added a white tip to the other end, and so forth. By
comparison, Smith suggested that if each of these 10 people
was individually expected to produce complete pins, the group
would collectively manufacture no more than 20 pins per day.44
One of the strongest advocates of job specialization was
Frederick Winslow Taylor, an American industrial engineer
who introduced the principles of scientific management in
the early 1900s.45 Scientific
scientific management The
management consists of a
practice of systematically partoolkit of activities. Some
titioning work into its smallest
of these interventions—
elements and standardizing
employee selection, training,
tasks to achieve maximum
goal setting, and work incenefficiency.
tives—are common today but
were rare until Taylor popularized them. However, scientific
management is mainly associated with high levels of job specialization and standardization of tasks to achieve maximum
Taylor recommended that the most effective companies should have detailed procedures and work practices
developed by engineers, enforced by supervisors, and
executed by employees. Even supervisory tasks should be
divided among different people (operations, inspection,
discipline). Although the accuracy of Taylor’s evidence is
suspect, scientific management practices do improve work
efficiency in many situations. These productivity gains
are partly due to training, goal setting, and work incentives, but job specialization quickly became popular in its
own right.
Chapter Six
Frederick Winslow Taylor and his contemporaries focused
on how job specialization reduces labour “waste” by improving the mechanical efficiency of work (i.e., matching skills,
faster learning, less switchover time). Yet they didn’t seem
to notice how this extreme job specialization negatively
affects employee attitudes and motivation. Some jobs—such
as scanning grocery items—are so specialized and repetitive
that they become tedious, socially isolating, and cognitively
dysfunctional. Specialized jobs with very short cycle times
often produce higher employee turnover and absenteeism.
Companies sometimes have to pay higher wages to attract
job applicants to this dissatisfying, narrowly defined work.46
Job specialization affects output quality, but in two opposing ways. On the positive side, employees in specialized
jobs tend to produce higher quality output because, as we
mentioned earlier, they master their work faster compared to
people in jobs with a wide variety of tasks. This higher proficiency explains why specialist lawyers tend to provide better
quality service than do generalist lawyers.47
However, job specialization also has two negative effects
on work quality. First, many jobs (such as supermarket
cashiers) are specialized to the point that they are highly
repetitive and tedious. Tedious work tends to reduce work
Applied Performance Practices 155
attentiveness and motivation, both of which undermine the
quality of output. Second, by performing a tiny piece of the
overall product or service, employees in specialized jobs
have difficulty striving for better quality or even noticing
flaws with the work unit’s overall output.
Job Design and Work Motivation
Frederick Winslow Taylor may have overlooked the motivational potential of job characteristics, but it is now the central
focus of many job design initiatives.
The motivational potential of the job itself is depicted
in the job characteristics model, shown in Exhibit 6.2.
The model identifies five core job dimensions that produce three psychological states. Employees who experience
these psychological states
job characteristics model
tend to have higher levels
A job design model that relates
of intrinsic motivation,
the motivational properties of
work performance (quality
jobs to specific personal and
and efficiency), and job
organizational consequences
satisfaction with the work
of those properties.
The Job Characteristics Model
Core Job
Personal and
Work Outcomes
Skill variety
Task identity
Task signif icance
Felt meaningfulness
of the work
Felt responsibility
for work outcomes
Work performance
(quality and efficiency)
Job feedback
Knowledge of
work results
Satisfaction with
the work itself
Individual Dif ference
156 Part Two
Individual Behaviour and Processes
Global Connections 6.4
Softcom Ltd. is a shining star in Nigeria’s emerging technology industry. This success is partly due to the software company’s capacity to motivate its 165 employees
through highly enriched jobs. Softcom staff are energized by the high task significance of their work, such
as a Patient Adherence Program for pharmaceutical
company GSK, a digital wallet payment and financial
services product (Eyowo), and a nationwide program
with digital foundations (called N-Power) to reintroduce
500,000 Nigerians to the labour market.
“The sheer scale, size and audacity of what we’re
doing here is one of the motivating factors for me to
come to work,” enthuses Abiola Fajimi, who leads
one of Softcom’s engineering development teams. “At
Softcom, there is always a sense of purpose,” adds
another Softcom employee. “We are all committed to the
goal of solving some of Africa’s biggest challenges, and
that in itself is what connects everything and everyone.”
Along with meaningful work, Softcom employees say
they are motivated by the high degree of autonomy in
their jobs. “I’ve realized that maybe just the freedom
©10’000 Hours/Getty Images
is what comforts people. Nobody is ringing the bell
for opening time and closing time,” says Abiola Fajimi.
“There’s just that expectation for you to take ownership
of your time and ideas. That level of expectation will
drive you to find the most productive ways to work.”
* “Toluyemi Nathaniel Talks about Being a Woman in the Tech Space with Softcom,” BellaNaija (blog), July 2, 2018; Y. Ogunlami, “Nigerian Engineers in
Hijabs,” Pulse Nigeria, August 3, 2018; “75 Softcomers Were Broken into 7 Hackathon Teams,” Twitter (Lagos, Nigeria: Softcom, January 24, 2019), https://
twitter.com/SoftcomNG/status/1088474546041208832; D.I. Adeleke, “I Visited a Young Nigerian Tech Company Generating Millions in Revenue and This Is
What I Learned,” Pulse Nigeria, January 29, 2019. Some information and quotations are also from Softcom’s website: https://softcom.ng/.
Core Job Characteristics
The job characteristics model identifies five core job characteristics. Under the right conditions, employees are more
motivated and satisfied when jobs have higher levels of these
• Skill variety. Skill variety refers to the use of different
skills and talents to perform tasks within a job. For example, sales clerks who norskill variety The extent to
mally only serve customers
which employees must use
might be assigned the
different skills and talents to
additional duties of stockperform tasks within their jobs.
ing inventory and changing
storefront displays.
task identity The degree to
which a job requires completion of a whole or an identifiable piece of work.
• Task identity. Task
identity is the degree
to which a job requires
completion of a whole
or identifiable piece of work, such as assembling an
entire broadband modem rather than just soldering in the
• Task significance. Task significance is the degree to
which the job affects the organization and/or larger society.
This job characteristic is
task significance The degree
most strongly felt when
to which a job has a substanemployees regularly and
tial impact on the organization
directly see how their
and/or larger society.
work affects customers
or others in society. As an example, when chefs in one
study were able to directly observe the customers who
ordered food (and vice versa), they felt more appreciated
and, consequently, exerted more effort and felt more satisfied with their job. “When [the customers] can see us
[make their food], they appreciate it, and I appreciate that.
It makes me want to improve,” says a cook who participated in the study.49 Task significance is often difficult
to perceive, however, for employees who work in labs,
factories, and offices away from end users. To boost their
task significance, some companies arrange occasional
meetings in which customers describe how they value
products these employees create. This recently occurred
at Microsoft Austria, when employees tagged along with
Chapter Six
their clients (police officers, hospital employees) at the
client sites for several days. The purpose of these immersion visits was to gather information about client needs
for product development. Yet, Microsoft management
also noticed that employees were noticeably “lit up” after
these visits because they had become more aware of how
their work was important for those clients.50
• Autonomy. As we learned in Chapter 5, autonomy is a
key ingredient for intrinsic motivation.51 In jobs with high
levels of autonomy, employees make their own decisions
rather than rely on detailed instructions from supervisors
or procedure manuals. These jobs provide freedom, independence, and discretion in scheduling the work and determining the procedures to be used to complete the work.
• Job feedback. Job feedback is the degree to which
employees can tell how well they are doing from direct
sensory information from the job itself. Airline pilots can
tell how well they land their aircraft, and road crews can
see how well they have prepared the roadbed and laid the
Critical Psychological States
The five core job characteristics affect employee motivation
and satisfaction through three critical psychological states,
shown in Exhibit 6.2. Skill variety, task identity, and task
significance directly contribute to the job’s felt meaningfulness of the work—the belief that one’s work is worthwhile or
important. Autonomy directly contributes to felt responsibility for work outcomes—a sense of being personally accountable for the work outcomes. The third critical psychological
state is knowledge of work results—an awareness of the work
outcomes based on information from the job itself.
Individual Differences
Job design doesn’t increase work motivation for everyone in
every situation. Employees must have the required skills and
knowledge to master the more challenging work. Otherwise,
job design tends to increase stress and reduce job performance. The original model also states that employees will be
motivated only when they have a high growth need strength
(the need for personal growth and development— similar to
self-actualization).52 However, research findings have been
mixed, suggesting that employees might be motivated by the
job no matter how they score on growth needs.53
The job characteristics model overlooks two other types of
job features: social characteristics and information processing demands.54 Two social job characteristics are:
Applied Performance Practices 157
• Social interaction requirements. This is the extent
to which the job requires employees to interact with
co-workers, clients, suppliers, and other stakeholders.
Jobs with high social interaction requirements tend to be
more motivating because employees need greater use of
emotional labour and regulation (see Chapter 4). Social
interaction also increases the complexity of the work due
to the person’s interdependence with these other people
(see task interdependence in Chapter 8).
• Social feedback. A second social characteristic of the
job is feedback from others. Jobs that include feedback
from people may be just as motivating as jobs that provide feedback from the task itself. Feedback from others
may be communicated explicitly through conversation or
more implicitly through subtle nonverbal cues.
The other category of job characteristics missing from the
job characteristics model is information processing demands
of the job.55 Two key information processing demands are:
• Task variability. This information processing demand
refers to how predictable the job duties are from one
day to the next. Task
task variability The degree to
variability increases
which job duties are nonroutine
employee motivation
and unpredictable; employees
because employees in
perform diverse tasks from one
these jobs have nonday to the next because they
routine work patterns;
are faced with unfamiliar and
unexpected issues.
they perform different
types of tasks from one
day to the next, and don’t know which tasks are required
until that time. Jobs with low task variability, on the other
hand, are less motivating because the work is repetitive;
employees perform similar tasks using similar skills in
the same way every day.
• Task analyzability. This information processing demand
refers to how much the job can be performed using
known procedures
task analyzability The
and rules. Jobs with
degree to which job duties
high task analyzability
allow the application of
have low information
established procedures and
processing demand
rules to guide decisions and
behaviour (high analyzabilbecause job incumbents
ity); employee creativity and
rely on established
judgment are necessary to
guidelines for most
perform jobs with low task
decisions and actions.
Consequently, employees are less motivated when performing jobs with high
task analyzability. Jobs with low task analyzability,
on the other hand, have higher motivational potential
because employees need to rely on their creativity and
judgment to determine the best courses of action for most
158 Part Two
Individual Behaviour and Processes
tasks. The novel or complex work activities in low task
analyzability jobs make it difficult to create fixed procedures and rules.
Task variability and task analyzability will be discussed
again in Chapter 8 in the context of task structures for teams
and in Chapter 13 when we look at contingencies for designing
organizational structures.
Three main strategies can increase the motivational potential of
jobs: frequent job rotation, job enlargement, and job enrichment.
Frequent Job Rotation
One common job design practice is to rotate production
employees through two or more jobs each day for the purpose of improving the motivational and physiological conditions of the work. This frequent job rotation is often confused
with career development transfers, in which professional and
managerial employees move once or twice each year to different jobs.
Canadian companies typically have frequent job rotation to reduce the risk of repetitive strain and heavy lifting
injuries. Machine operators at Mauser Packaging Solutions
in Aldergrove, B.C., rotate work stations every one to two
hours to minimize aches and sprains that occur when working on one machine all day. The packaging firm has achieved
one of the province’s highest safety designations.56
A second benefit of frequent job rotation is that employees learn how to perform multiple jobs. This multiskilling makes it easier for companies to fill positions that
are vacant due to vacations and other absences. A third
benefit is that employees develop a clearer picture of the
production or service process and ways to improve output
quality. In other words, job rotation seems to reverse the
performance quality problem that we discussed earlier for
job specialization. The fourth potential benefit of frequent
job rotation is that employees use a wider variety of skills
throughout the workday— their daily work has more skill
variety—which potentially improves their motivation and
EYE Lighting International practises frequent job rotation
because of these benefits. “Every employee on the factory
floor changes positions at least once a day,” says an executive
at the American subsidiary of Iwasaki Electric of Japan. “The
employees love it because they don’t get bored in their daily job.
Ergonomically, it’s good for them because they’re not doing the
same repetitive task day-in and day-out.” The EYE Lighting
executive also notes that job rotation gives the company “a tremendous amount of flexibility” when assigning work.57
Job Enlargement
Job enlargement is the practice of increasing the number and variety of related tasks assigned to a job held by
an employee. This might
involve combining two or
job enlargement The pracmore complete jobs into
tice of increasing the number
one or just adding one or
and variety of related tasks
assigned to a job.
two more tasks to an exist58
ing job. Either way, skill
variety increases because there are more tasks to perform.
Video journalist is an example of an enlarged job. As Exhibit 6.3
illustrates, a traditional news team consists of a camera operator, a sound and lighting specialist, and the journalist who
writes and presents or narrates the story. One video journalist performs the tasks of all of these jobs.
Job enlargement offers the same benefits as job rotation
because adding more and varied tasks gives employees more
skill variety and reduces the risk of repetitive strain injuries. Early research concluded that job enlargement often
Job Enlargement of Video Journalists
Traditional News Team
Employee 1
Operates camera
Employee 2
Operates sound
Employee 3
Reports story
Video Journalist
• Operates camera
• Operates sound
• Reports story
Chapter Six
Applied Performance Practices 159
Frequent job rotation—in which employees switch jobs
with co-workers one or more times each day—is considered a valuable practice in many production and service
job groups. It minimizes health risks from repetitive strain
and heavy lifting by relieving employees of that strain for
part of the day or, at least, allows them to use different
muscle groups in the rotated jobs. Employees in the rotation cycle see a larger part of the production process, so
they can more easily identify quality problems and their
solutions. Job rotation also increases workforce flexibility
by training employees in multiple jobs. Finally, job rotation
increases skill variety throughout the workday, which supports at least one motivational component of job design.
These job design benefits are widely recognized and
applauded, but less attention seems to be given to the
potential problems and limitations of this practice. One
concern is that employee task performance may be lower
when performing two or more jobs each day, even when
each job has a narrow range of tasks.* This performance
deficit occurs because employees who perform several
jobs have less time to practise and perfect their performance within each job. A related concern is that job rotation produces higher training costs because employees
need to learn the procedures for each job in the rotation
cluster. Task performance also suffers because the various
jobs likely require somewhat different aptitudes, such as
finger dexterity or emotional intelligence. Consequently,
job rotation does not assign employees as precisely to
tasks that fit their natural aptitudes.
Frequent job rotation also likely undermines task performance due to the problem of attention residue.** Attention
residue occurs when we continue to think about a previous
task after switching over to another task. An employee
who worked on inventory at the beginning of a shift might
continue to think about inventory decisions and problems
after rotating into a cashier position. Consequently, the
employee is less mindful of their checkout duties and is
more susceptible to errors in that role. The more frequent
the job rotation, the more risk that attention residue will
undermine performance in the current position.
Job rotation also overlooks the idea that people are
more motivated to perform some types of work than others.*** Some enjoy physical work whereas others prefer
work that involves social interaction, for example. In fact,
people often define themselves by specific jobs, such
as being a customer-focused person rather than a number-cruncher. Job rotation might undermine employee
motivation because employees are required to perform
tasks they don’t like and that are misaligned with their
A fourth concern is that job rotation might make it more
difficult to identify individual performance or accountability
for job site maintenance. If several employees switch jobs
every two hours, then each job will have three or more job
incumbents within one work shift. Nine or more employees
would have been in that position over 24 hours in a continuous production system. Unless work output is tagged or
time stamped, it becomes difficult to know which of these
employees made mistakes, didn’t sufficiently prepare the
work area for others, and so forth. Aware of their performance anonymity, some employees in job rotation clusters
will engage in social loafing—they exert less effort and produce lower quality or quantity output because their work
output is less identifiable.****
* S.G.H. Meyerding, “Job Characteristics and Job Satisfaction: A Test of Warr’s Vitamin Model in German Horticulture.,” The Psychologist-Manager Journal 18, no. 2
(2015): 86–107, https://doi.org/10.1037/mgr0000029; R. Su, C. Murdock, and J. Rounds, “Person-Environment Fit.,” in APA Handbook of Career Intervention,
Volume 1: Foundations., ed. P.J. Hartung, M.L. Savickas, and W.B. Walsh (Washington: American Psychological Association, 2015), 81–98, https://doi.org/
** S. Leroy and T.M. Glomb, “Tasks Interrupted: How Anticipating Time Pressure on Resumption of an Interrupted Task Causes Attention Residue and Low
Performance on Interrupting Tasks and How a ‘Ready-to-Resume’ Plan Mitigates the Effects,” Organization Science 29, no. 3 (2018): 380–97, https://doi.
*** E.H. Schein and J. Van Maanen, “Career Anchors and Job/Role Planning: Tools for Career and Talent Management,” Organizational Dynamics 45, no. 3 (2016):
165–73, https://doi.org/10.1016/j.orgdyn.2016.07.002; M. Abessolo, J. Rossier, and A. Hirschi, “Basic Values, Career Orientations, and Career Anchors: Empirical
Investigation of Relationships,” Frontiers in Psychology 8 (2017), https://doi.org/10.3389/fpsyg.2017.01556.
**** B. Latane, K. Williams, and S. Harkins, “Many Hands Make Light the Work: The Causes and Consequences of Social Loafing,” Journal of Personality 37, no. 6
(1979): 822–32; R.B. Lount and S.L. Wilk, “Working Harder or Hardly Working? Posting Performance Eliminates Social Loafing and Promotes Social Laboring in
Workgroups,” Management Science 60, no. 5 (2014): 1098–1106, https://doi.org/10.1287/mnsc.2013.1820; F. Chen, L. Zhang, and J. Latimer, “How Much Has
My Co-Worker Contributed? The Impact of Anonymity and Feedback on Social Loafing in Asynchronous Virtual Collaboration,” International Journal of Information
Management 34, no. 5 (2014): 652–59, https://doi.org/10.1016/j.ijinfomgt.2014.05.001.
produced higher employee motivation, job satisfaction, and
work efficiency.59 However, simply giving employees more
tasks falls significantly short of the motivational potential
of jobs as defined by the job characteristics model. Instead,
a job’s full motivational potential occurs when skill variety
is combined with more autonomy and job knowledge.60 In
160 Part Two
Individual Behaviour and Processes
other words, employees are motivated when they perform
a variety of tasks and have the freedom and knowledge to
structure their work to achieve the highest satisfaction and
performance. These job characteristics are at the heart of job
Job Enrichment
Job enrichment occurs when employees are given more
responsibility for scheduling, coordinating, and planning their
own work.61 For example,
job enrichment The practice
rather than reading a preof giving employees more
pared script for each client
responsibility for scheduling,
interaction, customer sercoordinating, and planning
vice employees are given
their own work.
both training and discretion regarding how long they should engage in conversation
with a client and what to say to them. Some call centre agents
even have budgets to send small gifts to customers following
special conversations. “You never know what they’re going
to type,” says an employee who provides online chat-based
customer service at Dollar Shave Club. “I have to listen and
respond. That’s all improv is.”62
People who perform enriched jobs tend to have higher job
satisfaction and work motivation, along with lower absenteeism and turnover. Productivity is also higher when task
identity and job feedback are improved. Product and service
quality tend to improve because job enrichment increases the
jobholder’s perceived responsibility and sense of ownership
over the product or service.63
One way to increase job enrichment is by combining
highly interdependent tasks into one job. This natural grouping approach occurs in the video journalist job because it
naturally groups tasks together to complete an entire product
(i.e., a news story). By forming natural work units, jobholders have stronger feelings of responsibility for an identifiable
body of work. They feel a sense of ownership and, therefore,
tend to deliver higher quality work output. Forming natural work units increases task identity and task significance
because employees perform a complete product or service
and can more readily see how their work affects others.
Telus Communications increased job enrichment among its service technicians by establishing direct client relationships.
Previously, clients communicated only with customer service staff at the Canadian telecommunications company; service
technicians performed the technical tasks with minimal customer interaction or responsibilities. Now, service technicians
are responsible for both technical and customer service activities for their respective assignments. Telus job ads for
technicians clearly emphasize these multiple roles: “You will be responsible for installing, maintaining and supporting
[Telus products] while driving future growth for TELUS by [providing] exemplary customer service and education to our
customers face to face on both new and existing products in the customer’s home.” As one Telus technician commented:
“It’s great for me personally, because I have a lot more ownership of the customer relationship.”*
* “Putting Customers First Is Critical to Success: Telus,” National Post, February 4, 2013. The job description is for Digital Home Technician-Greater
Vancouver on Telus’ job vacancies website (Taleo) on April 7, 2019.
Chapter Six
A second job enrichment strategy, called establishing client
relationships, involves putting employees in direct contact with
their clients rather than using another job group or the supervisor as the liaison between the employee and the customer.
Establishing client relationships increases task significance
because employees see a line-of-sight connection between
their work and consequences for customers. By being directly
responsible for specific clients, employees also have more information and can make better decisions affecting those clients.64
Grouping a natural cluster of tasks and establishing client
relationships are common ways to enrich jobs, but the heart
of the job enrichment philosophy is to give employees more
autonomy over their work. This basic idea is at the heart of
psychological empowerment, which we discuss next.
Psychological Empowerment
Psychological empowerment is a well-known outcome of
job enrichment, although it is also influenced by other work
conditions as well as employee characteristics. Psychological
empowerment refers to a perceptual and emotional state inwhich
people experience more self-determination, meaning, competence, and impact regarding their role in the organization.65
• Self-determination.
Employees feel that they
have freedom, independence, and discretion
over their work activities.
• Meaning. Employees
who feel empowered
care about their work and believe that what they do is
• Competence. Employees are confident about their ability
to perform the work well and have a capacity to grow
with new challenges.
• Impact. Employees view themselves as active participants in the organization; that is, their decisions and
actions have an influence on the company’s success.
psychological empowerment
A perceptual and emotional
state in which people experience more self-determination,
meaning, competence, and
impact regarding their role in
the organization.
When leaders say they are “empowering” the workforce, they
really mean that they are changing the work environment to
Applied Performance Practices 161
support psychological empowerment.66 A wide variety of
workplace conditions—often called structural empowerment
practices—potentially enhance or support psychological
Job characteristics clearly influence the degree to which
people feel empowered.68 Employees are much more likely
to experience self-determination when working in jobs with
a high degree of autonomy and minimal bureaucratic control. They experience more meaningfulness when working in
jobs with high levels of task identity and task significance.
Employees experience more self-confidence when working
in jobs that allow them to receive feedback about their performance and accomplishments.
Several organizational and work-context factors also
influence empowerment.69 People experience more empowerment in organizations in which information and other
resources are easily accessible, and in which employees
receive formal training and are encouraged to learn through
informal experimentation. Empowerment also requires corporate leaders to trust employees and be willing to take the
risks that empowerment creates.
Along with job and workplace conditions, psychological
empowerment depends on personal characteristics. In particular, employees must possess the skills and knowledge
necessary to perform the work and to handle the additional
decision-making requirements.
Psychological empowerment can substantially improve
motivation and performance. For instance, restaurant servers
with higher empowerment provide better customer service
and engage in more organizational citizenship behaviours
(specifically, helping other busy servers with their workload).70 However, organizational and cultural circumstances
can limit the extent to which the conditions for empowerment produce feelings of empowerment. A few studies have
observed, for example, that increased autonomy and discretion do not result in higher feelings of empowerment in
high power distance cultures because this self-determination
conflicts with the norms of high power distance (deferring
to the boss’s power). Whether employees feel empowered
when structural conditions for empowerment are present also
depends on how much they trust the company’s leaders.71
Self-Leadership Practices
The opening case study for this chapter described how Nurse
Next Door delegates responsibility and expects everyone
Are you empowered as a student? You can discover your level of empowerment as a student by
completing this self-assessment in Connect.
162 Part Two
Individual Behaviour and Processes
to manage themselves—as CEO Cathy Thorpe says: “to
be self-led.” Dave Burke, Google’s vice-president of engineering for the Android operating system, says that Google
takes the same approach. “Being laid back is one part of
[Google’s] culture,” says Burke. “The flip side is that we are
a very driven company that gets things done. The key to this
is employing highly self-motivated people.”72
Nurse Next Door, Google, and many other firms seek out
job applicants who are self-starters, self-motivated, and proactive. These are people who
engage in self-leadership.
self-leadership Specific
They establish the selfcognitive and behavioural
strategies to achieve perdirection and self-motivation
sonal goals and standards
needed to perform a task withthrough self-direction and
out their managers generating
that motivation or initiative.73
Self-leadership includes a
toolkit of behavioural activities borrowed from social cognitive theory and goal setting (see Chapter 5). It also includes
constructive thought processes that have been extensively
studied in sports psychology.
Self-leadership consists of several activities, particularly
the five identified in Exhibit 6.4. These elements generally follow each other in a sequence: personal goal setting,
constructive thought patterns, designing natural rewards,
self-monitoring, and self-reinforcement.74
Self-leadership refers to leading oneself toward objectives, so
the process necessarily begins by setting goals. These goals
are self-determined, rather than assigned by or jointly decided
with a supervisor. Research suggests that employees are more
motivated and perform better when they set their own goals,
particularly in combination with other self-leadership practices.75 Personal goal setting also requires a high degree of
self-awareness, because people need to understand their current behaviour and performance before establishing meaningful goals for personal development.
Before beginning a task and while performing it, employees engage in two positive (constructive) thought strategies
about that work and its accomplishment: positive self-talk
and mental imagery.
Positive Self-Talk
Do you ever talk to yourself? Most of us do, according to
a major study of Canadian college students.76 Self-talk
refers to any situation in
which we talk to ourselves
self-talk The process of
about our own thoughts
talking to ourselves about our
own thoughts or actions.
or actions. The problem is
that most self-talk is negative; we criticize much more than encourage or congratulate
ourselves. Negative self-talk undermines our confidence and
potential to perform a particular task. In contrast, positive
self-talk creates a “can-do” belief and thereby increases
motivation by raising our self-efficacy and reducing anxiety
about challenging tasks.77 We often hear that professional
athletes “psyche” themselves up before an important event.
They tell themselves that they can achieve their goal and that
they have practised enough to reach that goal. They are motivating themselves through self-talk.
Mental Imagery
You’ve probably heard the phrase “I’ll cross that bridge
when I come to it!” Self-leadership takes the opposite view.
It suggests that we need to mentally visualize specific future
behaviours as well as the
mental imagery The process
successful outcomes of
of mentally practising a task
those behaviours. In our
and visualizing its successful
mind’s eye, we practise
a task, successfully perform that task, and receive
the rewards of that successful performance. This process is
known as mental imagery.78
From our description, you can see that mental imagery has
two components. One component involves mentally practising the task, anticipating obstacles to goal accomplishment,
and working out solutions to those obstacles before they
occur. By mentally walking through the activities required
to accomplish the task, we begin to see problems that may
occur. We can then imagine what responses would be best
for each contingency.79
The other part of mental imagery involves visualizing
successful completion of the task. You might imagine the
Elements of Self-Leadership
goal setting
thought patterns
natural rewards
Chapter Six
Applied Performance Practices 163
Global Connections 6.5
Sarah Coll is a successful orthopedic surgeon in a country (Australia) where only 4 percent of people in this
field are women. She is adept at brushing off the occasional sexist comment about women in this profession.
But more difficult to ignore is her own negative self-talk.
“When it’s your internal monologue, that’s much more
challenging,” she says. “It’s so quiet, and so subversive.”
Everyone—including world-class athletes, highperformance executives, and successful surgeons—
has a natural tendency to engage in negative self-talk
more than constructive self-talk. It is one of the great
challenges people need to tackle along their journey
toward self-leadership.
Coll applies two strategies to minimize negative
self-talk. The first is to face the inner voice of self-doubt
head-on. “I’ve made myself accept that that negative selftalk is there, and I’ve gone to lengths to notice it, which is
extremely unpleasant,” she admits. “I think that’s always
the first step to stopping it is to stare it in the eye.”
Coll’s second strategy is to engage in constructive
mental imagery. She thinks about her objective for
each surgical procedure, and visualizes performing
©ERproductions Ltd/Blend Images LLC
a technically perfect operation that her entire theatre
team enjoys. Coll also consciously praises herself about
her success. “Ten years [into my career] I can tell myself
I’m offering the patient a world-class procedure,” she
says. “I’m offering the patient the best they could get in
the world.”
* Based on information in: M. Dulaney, “Impostor Syndrome can be Your Loudest Critic — Here’s How to Silence It,” ABC News (Australia), February 27, 2019.
experience of completing the task and the positive results
that follow, such as being promoted, receiving a prestigious
award, or taking time off work. Visualizing successful performance and its rewards activates energizing emotions,
which increases the individual’s goal commitment and motivation to complete the task effectively.80 This is the strategy
that Tony Wang applies to motivate himself. “Since I am in
sales, I think about the reward I get for closing new business—the commission cheque—and the things it will allow
me to do that I really enjoy,” explains the sales employee.
“Or I think about the feeling I get when I am successful at
something and how it makes me feel good, and use that to
get me going.”81
Self-leadership recognizes that employees actively “craft”
their jobs. To varying degrees, people often have enough
discretion in their jobs to make changes that match their
needs and preferences, which makes them more satisfying
and motivating.82 Employees develop natural rewards within
their job by expanding tasks that they inherently enjoy, offloading to others tasks they do not enjoy or that exceed their
reasonable workload, and changing how tasks are accomplished in ways that make them more developmental and
interesting. Employees also produce natural rewards by cognitively reframing the activity, such as by being more vigilant regarding the importance of the work for clients or by
more positively viewing difficult tasks as interesting challenges (see Chapter 4 on regulating emotions).
Self-monitoring is the process of keeping track at regular intervals of one’s progress toward a goal by using naturally occurring feedback. Self-monitoring significantly
improves employee performance.83 However, some types
of self-monitoring are better than others. Some people can
receive feedback from the job itself, such as members of a
lawn maintenance crew who can see how they are improving the appearance of their client’s property. But many
of us are unable to observe our work output so quickly or
164 Part Two
Individual Behaviour and Processes
easily. Instead, feedback mechanisms need to be designed.
Salespeople might arrange to receive monthly reports on
sales levels in their territory. Production staff might have
gauges or computer feedback systems installed so they
can see how many errors are made on the production line.
Research suggests that people who have control over the timing of performance feedback perform their tasks better than
do those with feedback assigned by others.84
Self-leadership includes self-reinforcement, which is part of
social cognitive theory described in Chapter 5. Self-reinforcement
occurs whenever an employee has control over a reinforcer but doesn’t “take” the reinforcer until completing
a self-set goal. A common example is taking a break after
reaching a predetermined stage of your work. The work
break is a self-induced form of positive reinforcement.
Self-reinforcement also occurs when you decide to do a
more enjoyable task after completing a task that you dislike. For example, after slogging through a difficult report,
you might decide to spend time doing a more pleasant task,
such as catching up on industry news by scanning websites.
One of the challenges with self-reinforcement is the temptation to take the reward before you should. Recent writing
has explored situational and emotional strategies to manage
these temptations so self-reinforcement remains true to one’s
original intentions.85
Self-leadership is shaping up to be a valuable applied performance practice in organizational settings. A respectable
body of research shows consistent support for most elements
of self-leadership.86 Furthermore, self-leadership strategies
seem to work just as well across cultures.87 Austrian army
soldiers who completed a self-leadership training course performed better on physical tests (such as time taken to complete an obstacle course) and educational tests on subjects
they were studying at the time, compared to soldiers who
didn’t take the course. Employees in a mining operation wore
safety equipment more frequently after engaging in self-set
goals and self-monitoring activities.
By applying mental imagery, supervisors and process
engineers in a pulp and paper mill more effectively transferred what they learned in an interpersonal communication
skills class back to the job. Studies also indicate that constructive thought processes improve individual performance
in various sports activities. Indeed, almost all Olympic athletes rely on mental rehearsal and positive self-talk to achieve
their performance goals.88
Some research suggests that self-leadership behaviours are
more frequently found in people with higher levels of conscientiousness and extraversion. People with a positive self-concept
evaluation (i.e., self-esteem, self-efficacy, and internal locus
of control) are also more likely to apply self-leadership
The work environment influences the extent to
which employees engage in self-leadership. Specifically,
self-leadership activities flourish when employees have
some degree of autonomy, when they believe their boss is
empowering rather than controlling, and when there is a high
degree of trust between them. Employees are also more likely
to engage in self-monitoring in companies that emphasize
continuous measurement of performance.90 Overall,
self-leadership promises to be an important concept and practice
for improving employee motivation and performance.
How well do you practise self-leadership? You can discover how well you practise various selfleadership activities by completing this self-assessment in Connect.
Do you have a proactive personality? You can discover the extent to which you have a proactive
personality by completing this self-assessment in Connect.
Chapter Six
Applied Performance Practices 165
Chapter Summary
Discuss the meaning of money and identify several individual,
team, and organizational-level performance-based rewards.
Money (and other financial rewards) is a fundamental part of the
employment relationship, but it also relates to our needs, our emotions, and our self-concept. It is viewed as a symbol of status and
prestige, as a source of security, as a source of evil, or as a source of
anxiety or feelings of inadequacy.
Organizations reward employees for their membership and
seniority, job status, competencies, and performance. Membershipbased rewards may attract job applicants and seniority-based
rewards reduce turnover, but they may discourage poor performers from quitting. Job status–based rewards try to maintain internal equity and motivate employees to compete for promotions.
However, they tend to encourage a bureaucratic hierarchy, support
status differences, and motivate employees to compete and hoard
resources. Competency-based rewards are becoming increasingly
popular because they encourage skill development. However, some
of these pay systems measure competence subjectively and most
increase the costs of learning new skills.
Awards and bonuses, commissions, and other individual performance-based rewards have existed for centuries and are widely
used. Many companies are shifting to team-based rewards such as
gainsharing plans and to organizational rewards such as employee
share ownership plans (ESOPs), share options, and profit sharing.
ESOPs and share options create an ownership culture, but employees often perceive a weak connection between individual performance and the organizational reward.
Describe five ways to improve reward effectiveness.
Financial rewards have a number of limitations, but reward effectiveness can be improved in several ways. Organizational leaders should ensure that rewards are linked to work performance,
rewards are aligned with performance within the employee’s
control, team rewards are used where jobs are interdependent,
rewards are valued by employees, and rewards have no unintended
List the advantages and disadvantages of job specialization.
Job design is the process of assigning tasks to a job, including
the interdependency of those tasks with other jobs. Job specialization subdivides work into separate jobs for different people.
This increases work efficiency because employees master the
tasks quickly, spend less time changing tasks, require less training, and can be matched more closely with the jobs best suited to
their skills. However, job specialization may reduce work motivation, create mental health problems, lower product or service
quality, and increase costs through discontentment, absenteeism,
and turnover.
Diagram the job characteristics model and describe three ways
to improve employee motivation through job design.
The job characteristics model is a template for job redesign that
specifies core job dimensions, psychological states, and individual differences. The five core job dimensions are skill variety, task
identity, task significance, autonomy, and job feedback. Jobs also
vary in their required social interaction (task interdependence), predictability of work activities (task variability), and procedural clarity (task analyzability). Contemporary job design strategies try to
motivate employees through job rotation, job enlargement, and job
enrichment. Organizations introduce job rotation to reduce job boredom, develop a more flexible workforce, and reduce the incidence
of repetitive strain injuries. Job enlargement involves increasing the
number of tasks within the job. Two ways to enrich jobs are clustering tasks into natural groups and establishing client relationships.
Define psychological empowerment and identify strategies that
support empowerment.
Psychological empowerment is a perceptual and emotional state in
which people experience more self-determination, meaning, competence, and impact regarding their role in the organization. Individual
characteristics seem to have a minor influence on empowerment.
Job design is a major influence, particularly autonomy, task identity, task significance, and job feedback. Empowerment is also
supported at the organizational level through information, communication, resources, encouraging experimentation, and trust by corporate leaders in their employees.
Describe the five elements of self-leadership and identify
specific personal and work environment influences on
Self-leadership refers to specific cognitive and behavioural strategies to achieve personal goals and standards through self-direction and self-motivation. These strategies include personal goal
setting, constructive thought patterns, designing natural rewards,
self-monitoring, and self-reinforcement. Constructive thought patterns include self-talk and mental imagery. Self-talk occurs in any
situation in which a person talks internally about their own thoughts
or actions. Mental imagery involves mentally practising a task and
imagining successfully performing it. People with higher levels
of conscientiousness, extraversion, and a positive self-concept are
more likely to apply self-leadership strategies. Self-leadership also
increases in workplaces that support empowerment and have high
trust between employees and management.
166 Part Two
Individual Behaviour and Processes
Key Terms
employee share ownership plans (ESOPs)
gainsharing plan
job characteristics model
job enlargement
job enrichment
job evaluation
job specialization
mental imagery
profit-sharing plan
psychological empowerment
scientific management
share options
skill variety
task analyzability
task identity
task significance
task variability
Critical Thinking Questions
1. As a consultant, you have been asked to recommend either
a gainsharing plan or a profit-sharing plan for employees
who work in the four regional distribution and warehousing facilities of a large retail organization. Which reward
system would you recommend? Explain your answer.
2. Which of the performance reward practices—individual,
team, or organizational—would work better in improving
organizational goals? Please comment with reference to
an organization of your choice.
3. Kelowna Tire Corporation redesigned its production
facilities around a team-based system. However, the
company president believes that employees will not
be motivated unless they receive incentives based on
their individual performance. Give three reasons why
Kelowna Tire should introduce team-based rather than
individual rewards in this setting.
4. What can organizations do to increase the effectiveness
of financial rewards?
5. Most of us have watched pizzas being made while waiting in a pizzeria. What level of job specialization do you
usually notice in these operations? Why does this high or
low level of specialization exist? If some pizzerias have
different levels of specialization than others, identify the
contingencies that might explain these differences.
6. Can a manager or supervisor “empower” an employee?
Discuss fully.
7. Describe a time when you practised self-leadership to
successfully perform a task. With reference to each step
in the self-leadership process, describe what you did to
achieve this success.
8. The city manager of a large Canadian municipality wants
to reduce supervisory costs by encouraging employees to
motivate and manage themselves much of the time. The
manager has heard of self-leadership and believes that
it may be a key strategy to reduce the number of supervisors in the organization. Discuss the extent to which
self-leadership practices among employees would support the city manager’s objectives. Also, summarize the
content of a training module that would improve any one
of the self-leadership practices.
Case Study:
by Steven L. McShane, University of Newcastle (Australia)
YakkaTech Ltd. is an information technology services firm
employing 1,500 people across Canada. YakkaTech has a consulting division, which mainly installs and upgrades enterprise software systems and related hardware on the client’s site. YakkaTech
also has a customer service division, which consists of four customer contact centres serving clients within each region.
Each customer contact centre consists of a half-dozen
departments representing functional specializations (computer
Chapter Six
systems, intranet infrastructure, storage systems, enterprise
software systems, customer billing, etc.). These centres typically have more than two dozen employees in each department. When a client submits a problem to the centre using the
online form, the message or call is directed to the department
where the issue best applies. The query is given a “ticket”
number and is assigned to the next available employee in that
department. Individual employees are solely responsible for
the tickets assigned to them. The employee investigates and
corrects the issue, and the ticket is “closed” when the client
agrees that the problem has been resolved.
If the client experiences the same problem again, even a few
days later, a new ticket is issued and sent to whichever employee
is available to receive the ticket. A client’s problems are almost
always handled by different employees each time, even when
the issue is sent to the same department. Furthermore, when a
customer centre department is heavily backlogged, clients are
redirected to the same department at another regional centre
where their problem can be addressed more quickly.
At one time, YakkaTech operated more than a dozen small
customer contact centres in each city because client problems
had to be diagnosed and resolved on-site. Today, employees
can investigate most software and hardware system faults
from the centre through remote monitoring systems, rather
than personally visiting the client. Consequently, eight years
ago YakkaTech amalgamated its customer service operations
into four large regional centres. Customer service staff work
entirely within the centre. When a client visit is required, the
ticket is transferred to an individual or team in the consulting
business, who then visits the client.
YakkaTech’s customer service business has nearly doubled
over the past five years, but with this growth has come increasing numbers of customer complaints regarding poor quality service. Many say that employees seem indifferent to the client’s
problems. Others have commented on the slow response to their
problems where the issue requires involvement of more than one
department. Several clients have also complained that they are
continually educating YakkaTech’s customer service employees
about details of their unique IT systems infrastructure.
Another concern is that, until 18 months ago, YakkaTech’s
voluntary employee turnover rates in the contact centres had
Applied Performance Practices 167
risen above the industry average. This increased labour costs
due to the expense of recruiting new technical staff as well as
lower productivity of new employees. According to results of
an employee survey two years ago (as well as informal comments since then), many employees feel that their work is
monotonous. Some also said that they feel disconnected from
the consequences of their work. A few also complained about
ongoing conflicts with people in other departments and the
stress of serving dissatisfied clients.
Eighteen months ago, YakkaTech’s executive team decided
to raise pay rates for its customer service staff to become
among the highest in the industry. The assumption was that
the high pay rates would improve morale and reduce turnover,
thereby reducing hiring costs and improving productivity. In
addition, YakkaTech introduced a vested profit-sharing plan,
in which employees received the profit-sharing bonus only if
they remained with the company for two years after the bonus
was awarded. Employees who quit or were fired for just cause
before the vesting period forfeited the bonus.
Employee turnover rates dropped dramatically, so the executive team concluded that customer service quality and productivity would improve. Instead, customer complaints and
productivity remain below expectations and, in some cases,
have worsened. Experienced employees continue to complain
about the work. There are a few disturbing incidents where
employees are careless at solving client problems or do not
bother to forward tickets that should have been assigned to
another department. Employee referrals (where staff recommend friends to join the company) have become rare events,
whereas at one time they represented a significant source of
qualified job applicants. Furthermore, a few executives have
recently overheard employees say that they would like to
work elsewhere but can’t afford to leave YakkaTech.
Discussion Questions
1. What symptom(s) in this case suggest that something has
gone wrong?
2. What are the main causes of these symptoms?
3. What actions should YakkaTech executives take to correct these problems?
© 2009 Steven L. McShane
Team Exercise:
Purpose This exercise is designed to help you learn how to
measure the motivational potential of jobs and evaluate the
extent that jobs should be further enriched.
Instructions (Small Class) Being a student is like a job in
several ways. You have tasks to perform, and someone (such as
your instructor) oversees your work. Although few people want
168 Part Two
Individual Behaviour and Processes
to be students most of their lives (the pay rate is too low!), it may
be interesting to determine how enriched your job is as a student.
1. Students are placed into teams (preferably four or five
2. Working alone, each student completes both sets of measures in this exercise. Then, using the guidelines below,
they individually calculate the score for the five core job
characteristics as well as the overall motivating-potential
score for the job.
3. Members of each team compare their individual results.
The group should identify differences of opinion for each
core job characteristic. They should also note which core
job characteristics have the lowest scores and recommend how these scores could be increased.
4. The entire class will then meet to discuss the results of
the exercise. The instructor may ask some teams to present their comparisons and recommendations for a particular core job characteristic.
Instructions (Large Class)
1. Working alone, each student completes both sets of measures in this exercise. Then, using the guidelines below,
each student individually calculates the score for the five
core job characteristics as well as the overall motivating-potential score for the job.
2. Using a show of hands or classroom technology, students
indicate their results for each core job characteristic. The
instructor will ask for results for several ranges across the
scales. Alternatively, students can complete this activity
prior to class and submit their results through online
classroom technology. Later, the instructor will provide
feedback to the class showing the collective results (i.e.,
distribution of results across the range of scores).
3. Where possible, the instructor might ask students with
very high or very low results to discuss their views with
the class. ​​
Job Diagnostic Survey
Circle the number on the right that best describes student work.
1. To what extent does student work permit you to decide on your
own how to go about doing the work?
2. To what extent does student work involve doing a whole or
identifiable piece of work, rather than a small portion of the
overall work process?
3. To what extent does student work require you to do many
different things, using a variety of your skills and talents?
4. To what extent are the results of your work as a student likely
to significantly affect the lives and well-being of other people
(e.g., within your school, your family, society)?
5. To what extent does working on student activities provide
information about your performance?
Circle the number on the right that best describes student work.
6. Being a student requires me to use a number of complex and high-level skills.
7. Student work is arranged so that I do not have the chance to do an entire
piece of work from beginning to end.
8. Doing the work required of students provides many chances for me to
figure out how well I am doing.
9. The work students must do is quite simple and repetitive.
10. The work of a student is the type where a lot of other people can be
affected by how well the work gets done.
11. Student work denies me any chance to use my personal initiative or judgment in carrying out the work.
12. Student work provides me the chance to completely finish the pieces of
work I begin.
13. Doing student work by itself provides very few clues about whether I am
performing well.
14. As a student, I have considerable opportunity for independence and
freedom in how I do the work.
15. The work I perform as a student is not very significant or important in the
broader scheme of things.
Chapter Six
Applied Performance Practices 169
Scoring Core Job Characteristics: Use the following set of calculations to estimate the motivating-potential score for the
job of being a student. Use your answers from the Job Diagnostic Survey that you completed above.
Core Job
Skill variety (SV)
Question 3 + 6 + 9
 ​​ =
Question 2 + 7 + 12
​​ _______________
 ​​ =
Question 4 + 10 + 15
 ​​ =
Task significance (TS)   
Task identity (TI)
Core Job
Job feedback
Question 1 + 11 + 14
 ​​ =
Question 5 + 8 + 13
​​ _________________
 ​​ =
Calculating Motivating-Potential Score (MPS): Use the following formula and the earlier results to calculate the motivatingpotential score. Notice that skill variety, task identity, and task significance are averaged before being multiplied by the score
for autonomy and job feedback.
+ TS ​​ × Autonomy × Job Feedback
​​ ​  SV + TI  ​
+ + ​​ × ​​ ​​× ​​ ​
​= ​​ ​
Self-Assessments for Chapter 6
What is your attitude toward
Money is a fundamental part of the employment relationship, but it is more than just an economic
medium of exchange. Money affects our needs, our emotions, and our self-concept. People hold a
variety of attitudes toward money. One widely studied set of attitudes is known as the “money ethic.”
This self-assessment estimates how much you budget, respect, and worry about money.
Are you empowered as a
Empowerment is a psychological concept represented by feelings of self-determination, meaning,
competence, and impact. The empowerment concept applies to people in a variety of situations, not
just the workplace. This self-assessment, which specifically refers to your position as a student at your
college or university, estimates your level of empowerment overall and on each of its four dimensions.
How well do you practise
Self-leadership refers to specific cognitive and behavioural strategies that people apply to themselves
to support the self-direction and self-motivation needed to perform a task. It recognizes that successful
employees mostly regulate their own actions rather than rely on others to motivate them. This self-assessment estimates how much you engage in several self-leadership activities.
Do you have a proactive
People differ in how much they try to influence the environments in which they live. Those with a
proactive personality take action to change things while less proactive people adapt to the existing
situation. Proactive personality is a stable personality characteristic, and is associated with self-leadership. This self-assessment estimates the extent to which your disposition includes the tendency to take
personal initiative.
PART THREE Team Processes
Decision Making and Creativity
After reading this chapter, you should be able to:
LO1 Describe the elements of rational choice decision making.
LO2 Explain why people don’t apply rational choice decision making when identifying
problems/opportunities, evaluating/choosing alternatives, and evaluating decision
LO3 Discuss the roles of emotions and intuition in decision making.
LO4 Describe employee characteristics, workplace conditions, and specific activities that
support creativity.
LO5 Describe the benefits of employee involvement and identify four contingencies that
affect the optimal level of employee involvement.
Atlantic Lottery Corporation (ALC) has become a
lightning rod of creativity and responsive decision making. In fact, the Crown corporation was
recently recognized as one of the most innovative
lottery organizations in North America. ALC has
accelerated its creative output by adapting design
thinking as its template for decision making.
Design thinking is a holistic process that involves
multiple stakeholders, embraces ambiguity rather
than static solutions, and relies on low-cost prototypes with rapid customer feedback to test ideas.
ALC’s product development team discovers problems and opportunities by conducting
Atlantic Lottery Corporation is one of North America’s most
non-directive immersion interviews to understand
innovative businesses in its industry because it applies the
the customer experience. “Sometimes we just go
design thinking principles of decision making.
to a coffee shop and offer people a gift certificate
to sit and give us their ideas and opinions,” says
Jean Marc Landry, Atlantic Lottery vice president of player experience & innovation. “What they tend to
give us is rich, deep insight.” Great ideas also occur when customers describe their delight with completely different products and services. “Customers will talk about how a company like Uber enriches
their lives and we look for ways to apply that thinking to our own products,” says Landry.
Chapter Seven
Decision Making and Creativity
Rather than hiding unfinished products from public view, ALC takes the “risky” approach by enlisting customers to test prototypes—rough early versions of the product—and quickly seeks their feedback to make
further refinements. “Now we start showing products to customers immediately in the design stage. . .we
often develop four or five iterations of a product before we produce a final version,” says Landry. “We get
really quick output from these events because really quickly you can design an idea and have it prototyped
within a couple days.”
Decision making through design thinking may have sprouted from ALC’s product development group,
but employees throughout the organization are now learning to apply these principles in their decisions.
“Whatever the problem, you can use this approach [design thinking]. It’s become a part of our culture,”
Landry explains. “Those little tests, and those little risks, and those experiences have developed a new
mindset in the organization,” says Julie LeBlanc Steeves, ALC’s manager of player experience.1
The executive team at Atlantic Lottery Corporation invested
heavily in an emerging model of decision making because the
company’s future depends on employee decisions that are more
responsive and creative. All organizations depend on employees to foresee and correctly identify problems or opportunities,
to consider the full range of alternatives, to pick the best alternative based on several relevant factors, and to execute and
evaluate those decisions effectively and objectively.
This chapter examines each of these themes. It begins
by describing the rational choice view of decision making.
Next, the human limitations of rational choice—we call it
imperfect rationality—are discussed in the context of how
human beings actually make decisions. We also examine
the emerging view that decisions consist of a complex interaction of logic and emotion. The latter part of this chapter
focuses on two topics that intertwine with decision making:
creativity and employee involvement.
Rational Choice Decision Making
Decision making is the process of making choices among
alternatives with the intention of moving toward some
desired state of affairs.2 How can we make effective
decisions in organizations?
decision making The
This chapter answers this
conscious process of making
question by describing
choices among alternatives with
different ways of thinkthe intention of moving toward
ing about decision making
some desired state of affairs.
and by examining several
issues at each stage of the
decision-making process.
rational choice decision
making The process of using
We begin this journey by
pure logic and all available
discussing the earliest perinformation about all alternaspective—rational choice
tives to choose the alternative
decision making—which
with the highest value.
is the process of using pure
logic and all available information about all alternatives to
choose the alternative with the highest value. Choices with
the highest value might have the highest expected profitability, customer satisfaction, employee well-being, or some
combination of these outcomes.
For most of written history, Western societies have characterized rational choice as an ideal state of decision making.
The rational choice view was established 2,500 years ago
when Plato and his contemporaries in ancient Greece raised
logical debate and reasoning to a fine art.3 About 400 years
ago, Descartes and other European philosophers emphasized
that the ability to make logical decisions is one of the most
important accomplishments of human beings. In the 1700s,
Scottish philosophers refined the notion that the best choice
is the one that offers the greatest satisfaction. As we shall
discover, these views of rational choice decision making are
flawed, but this approach provides a useful foundation to
understand this topic.
Rational choice decisions often involve complex calculations of data to produce a formula that points to the best
choice. Basically, this formula determines the best alternative by calculating the probability that various outcomes
will occur from the choices and the expected satisfaction
(valences) from each of those outcomes.4 We have already
described similar calculations of probability and valences
in organizational behaviour theories presented earlier in this
book, notably the attitude model in Chapter 4 and expectancy theory of motivation in Chapter 5.
The example shown in Exhibit 7.1 will help to explain
how the rational choice calculation works.5 Suppose that you
are given the task of choosing a new supplier of a specific
raw material used in the company’s products. From experience, you estimate that the preferred supplier should provide
a high-quality product (+9) with low prices (+6) and on-time
delivery (+4).6 The numbers, which are on a plus or minus
10-point scale in this example, indicate the valence of each
outcome, that is, its expected satisfaction or importance. You
172 Part Three
Team Processes
Rational Choice Decision-Making Example
(“expectancy”) the
outcome will occur
with that supplier
Supplier A
Outcomes valences
Product quality
On-time delivery
Low prices
Product quality
On-time delivery
Low prices
Supplier B
Relevant outcomes
(selection criteria)
estimate that supplier A has excellent on-time delivery (about
90 percent probability of exceeding the company’s expectations), an 80 percent likelihood of offering low prices, and a
70 percent probability of reliably providing a product with
exceptional quality. Supplier B has a 90 percent chance of
providing very high product quality but a lower likelihood of
on-time delivery (60 percent) and of offering the low prices
(40 percent).
Which of these two suppliers should be selected? A rational choice decision maker would choose Supplier A because
that company would produce the highest expected satisfaction. This composite valence is calculated by multiplying
the valence of each outcome by the probability of that outcome occurring, then adding those results across all three
outcomes. The supplier with the higher score is the better
choice, given available information. The key point from this
example is that all rational decisions rely primarily on two
pieces of information: (a) the probability that each outcome
will occur and (b) the valence or expected satisfaction of
each outcome.
Calculating the best alternative is at the heart of rational choice decision making, but it goes hand in hand with
the systematic decision process illustrated in Exhibit 7.2.7
The first step is to identify the problem or recognize an
opportunity. A problem is a deviation between the current
and the desired situation—the gap between “what is” and
“what ought to be.” This deviation is a symptom of more
fundamental causes that need to be corrected. The “ought to
be” refers to goals or performance expectations, which later
help to evaluate the selected choice.8 For instance, if a customer contact centre’s goal is to answer incoming client calls
within 30 seconds, the problem is the gap between that goal
and the actual time the call centre takes to answer most client
calls. An opportunity is a deviation between current expectations and a potentially better situation that was not previously
expected. In other words, an opportunity exists when decision makers discover that some choices may produce better
results than current goals or expectations.
The second step involves choosing the best decision
process. This is really a meta-decision—deciding how to
decide—because it refers to choosing among the different approaches and processes to make the decision.9 One
meta-decision is whether to solve the problem alone or
involve others in the process. We’ll examine the contingencies of employee involvement in decision making in the last
section of this chapter. Another factor in choosing the best
decision process is how much time is available to make the
decision. A third factor is the degree of decision uncertainty,
that is, how difficult it is to estimate outcome probabilities for
each alternative. A fourth contingency is whether the problem is routine or novel. Routine problems are programmed
decisions because the decision maker would have ready-made
Chapter Seven
Decision Making and Creativity
Rational Choice Decision Process
1. Identify
problem or
6. Evaluate
the selected
5. Implement
the selected
2. Choose
the best
3. Discover
or develop
4. Select the
choice with the
highest value
alternatives or even solutions learned from the earlier encounters with that problem. In contrast, new or unique problems
are nonprogrammed decisions because they require the decision maker to work through all steps in the decision model.
The third step in the rational choice decision-making process is to identify and/or develop a list of possible choices. This
usually begins by searching for ready-made solutions, such as
practices that have worked well on similar problems. If none of
the existing solutions is acceptable, then decision makers need
to design a custom-made solution or modify an existing one.
The fourth step is to select the best choice by applying the
rational choice calculation we described in Exhibit 7.1. To
choose the alternative with the greatest expected satisfaction,
the decision maker must have information about all possible alternatives and their outcomes. That condition is usually
impossible, but the rational choice view of decision making
assumes this can be accomplished with ease.
The fifth step in the rational choice decision-making
process is to implement the selected alternative. The rational choice view has little to say about this step because it
assumes that implementation occurs without any problems.
The final step is to evaluate whether the gap has narrowed
between “what is” and “what ought to be.” Ideally, this information should come from systematic benchmarks so that relevant feedback is objective and easily observed.
Some sources say that when Albert Einstein was asked how
he would save the world in one hour, he replied that most of
that time should be spent defining the problem and the rest of
that hour solving the problem.11 Whether Einstein or someone else uttered this advice, it makes the important point that
problem identification is not just the first step in decision
making; it is arguably the most important step. But problems
and opportunities are not clearly labelled objects that appear
on our desks. Instead, they are conclusions that we form
from ambiguous and conflicting information.12
Solution-Focused Problems
The rational choice view seems so logical, yet there are several reasons why it is impossible to apply in reality.10 Over
the next several pages, we re-examine each step in the rational
choice decision-making process, but with more detail about
what really happens from the lens of imperfect rationality.
Identifying Problems and Opportunities
Only by forming an accurate understanding of the problem
can we move toward a meaningful solution. Unfortunately,
the problem identification stage is, itself, filled with problems. Here are five of the most widely recognized concerns.
One problem-identification error occurs when decision makers jump to a solution before understanding the problem.13
This is evident when the problem is described as a veiled
174 Part Three
Team Processes
Global Connections 7.1
To make the best decisions, employees need to know
the best decision process for that particular situation.
In other words, they need to decide how to decide.
German manufacturer Bosch Packaging Technology
(BPT) guides its employees through this meta-decision
using a matrix that identifies the preferred decision
methodology for each type of problem or opportunity.
Some problems, such as deciding how to improve
production efficiency, have stable conditions and require
fairly simple knowledge and requirements. For these
“evident” situations, BPT recommends a decision process that applies lean practices. Lean practices use systematic data collection, testing, and analysis to discover
the best ways to improve the current work situation.
For problems that are more complicated and somewhat dynamic or unstable, such as when a client experiences faults with its production technology, Bosch
Packaging Technology advocates an agile decision
process. Agile practices typically rely on self-directed
cross-functional teams to make decisions. BPT teams
have diverse knowledge and skills to quickly discover
the cause of the problem and implement a customized
solution for these types of issues.
Some decisions at Bosch Packaging Technology are
highly complex, ambiguous, and novel, such as developing new products and services. In these situations, the
company encourages the design thinking decision process. Design thinking relies on cross-functional, autonomous teams, but employees are more circumspect and
reflective about defining the problem or opportunity
(whereas the problem is already defined or is quickly
determined in other decision processes). BPT’s design
thinking teams focus on the user experience to gain
insight about the problem definition as well as about
possible solutions. They also cycle through multiple
iterations of prototypes with customer feedback in each
cycle to develop the new product or service.
©Hero Images Inc./Alamy Stock Photo
* Based on information at: “The Right Method For Solving The Problem On Hand,” Bosch Packaging Technology, accessed January 13, 2020, https://
solution, such as: “The problem is that we need more control
over our suppliers.” This isn’t a description of the problem;
it is a rephrased statement of a solution to a problem that has
little or no diagnosis. The solution-focused mindset recently
occurred when the executive who launched Apple’s retail
stores was subsequently hired as CEO of JCPenney. The executive quickly identified the ailing American retailer’s main
problem in a way that was actually a veiled solution: It needed
to be more like Apple. JCPenney’s popular coupons and store
sales were abandoned because Apple rarely discounted its
products. JCPenney stores were redesigned to look more like
Apple stores. The former Apple executive curtly explained that
he didn’t test these changes because “We didn’t test at Apple.”
Less than two years later, JCPenney’s sales had plummeted by
one-third and the former Apple executive was out the door.14
Why do decision makers fall into the solution-focused
problem trap? One reason is that they have been reinforced by
past successes with that solution. When new problems arise,
the solution that worked in the past quickly comes to mind
before proper problem diagnosis can occur. A second reason is
that decision makers are comforted by closure to problems, so
they nonconsciously embed a solution in their problem definition. Unfortunately, this solution-focused situation fails to
fully diagnose the underlying causes that need to be addressed.
Decisive Leadership
Various studies have found that executives are evaluated by
their decisiveness, including how quickly they determine that
the situation is a problem, opportunity, or nothing worth their
attention.15 Consequently, many leaders announce problems
or opportunities before having a chance to logically assess
the situation. The result is often a misguided effort to solve
an ill-defined problem by wasting funds on a poorly identified opportunity.
Chapter Seven
Stakeholder Framing
Employees, suppliers, customers, and other stakeholders
present (or hide) information in ways that makes the decision
maker see the situation as a problem, opportunity, or steady
sailing.16 Employees point to external factors rather than their
own faults as the cause of production delays. Suppliers market their new products as unique opportunities and competitor products as risky choices. Many other stakeholders also
frame the situation in ways that decision makers will view as a
problem or otherwise. Decision makers fall prey to these constructed realities because they have a need to simplify the daily
bombardment of complex and often ambiguous information.
Perceptual Defence
Under some conditions, decision makers either fail to recognize or quickly forget information that threatens the situation. The tendency to engage in perceptual defence (or its
variation, called repressive coping) is a coping mechanism.
It is more likely to occur in decision makers with higher
trait anxiety (high neuroticism) and when they have limited
options to solve the problem.17
Mental Models
Decision makers are victims of their own problem framing due
to existing mental models. Mental models are knowledge structures that we develop to describe, explain, and predict the world
around us.18 These visual or
relational images in our mind
mental models Knowledge
of the external world fill in
structures that we develop to
describe, explain, and predict
information that we don’t
the world around us.
immediately see, which fulfils our need to understand
and navigate the surrounding environment (see Chapter 3).
Many mental images are also prototypes of ideal conditions—
they represent models of how things should be. Unfortunately,
these mental models can blind us from seeing unique problems
or opportunities because they produce a negative evaluation of
things that are dissimilar to the mental model. If an idea doesn’t
fit the existing mental model of how things should work, then it
is quickly dismissed as unworkable or undesirable.
Recognizing problems and opportunities will always be a
challenge, but one way to improve the process is by becoming aware of the five problem identification biases just
described. For example, by recognizing that mental models
restrict a person’s perspective of the world, decision makers are more motivated to consider other perspectives of
reality. Along with increasing their awareness of problem
Decision Making and Creativity
identification flaws, leaders require considerable willpower
to resist the temptation of looking decisive when a more
thoughtful examination of the situation is warranted.
A third way to improve problem identification is to create a
norm of “divine discontent.” Decision makers with this mindset are never satisfied with current conditions, no matter how
successful that situation may be, so they more actively search
for problems and opportunities.19 Fourth, employees can minimize problem identification errors by discussing the situation
with other people, particularly those with different experiences
and backgrounds. It is much easier to discover blind spots in
problem identification when listening to how others perceive
the situation. Opportunities also become apparent when outsiders explore this information from their different mental models.
Searching for, Evaluating, and
Choosing Alternatives
The rational choice view of decision making assumes that
decision makers rely on logic to evaluate and choose alternatives. It also assumes that they have well-articulated
and agreed-upon organizational goals, that they efficiently
and simultaneously process facts about all alternatives and
the consequences of those alternatives, and that they choose
the alternative with the best possible outcomes.
Nobel Prize–winning organizational scholar Herbert Simon
questioned these assumptions a half century ago. He argued
that people engage in bounded rationality because they
process limited and imperfect information and rarely try to
select the best choice.20 Bounded rationality is the most widely
known theory questioning
the rational choice view,
bounded rationality The
but it is not alone. Other
view that people are bounded
in their decision-making capaimperfect rationality theobilities, including access to
ries identify imperfections
limited information, limited
in how people form preferinformation processing, and
ences, how they short-circuit
tendency toward satisficing
the decision-making prorather than maximizing when
making choices.
cess, and how their choices
are distorted by faulty heuristics and other perceptual biases.21 Overall, as Exhibit 7.3
illustrates, organizational behaviour theories identify several
ways that human decision making differs from rational choice
assumptions. Let’s look at these differences in terms of goals,
information processing, and maximization.
Goals are a critical component of all decisions because they
establish “what ought to be” and, therefore, provide a standard against which each alternative is evaluated. The rational
176 Part Three
Team Processes
Global Connections 7.2
One of the most successful sitcoms (situational comedies) in history almost didn’t make it to prime time.
Seinfeld was soundly rejected by executives at Fox network and almost had the same fate at NBC, which aired
the pilot episode.
The show’s near-miss with success occurred because
it was a new form of television comedy, one that was
profoundly different from the deeply reinforced mental
models that network executives relied on to identify
future program gems. Popular sitcoms wove humour
into a storyline that often addressed current ethical or
social issues, whereas Seinfeld was a show about nothing—just humorous dialogue in “moments” of everyday
life (such as going to a laundromat or waiting too long
for dinner at a restaurant). In the minds of network executives, lead characters in successful sitcoms had emotional attachments or conflicts and displayed occasional
heroism. Seinfeld’s characters lived separate lives, had
minimal emotional relationships, and were hardly heroic.
NBC executive Rick Ludwin is widely credited with
saving Seinfeld from the dustbin. In his early days,
Ludwin had done stand-up comedy and read Saturday
Night Live scripts, so he recognized the potential of
Seinfeld’s unique humour. Also, Ludwin was responsible
for late-night programming, not sitcoms, so he didn’t
rely on the outdated mental models that blinkered sitcom executives regarding what a successful program
should look like. Seinfeld scriptwriters Larry David and
Jerry Seinfeld also lacked experience in the sitcom
industry, which enabled them to produce scripts that
forged new territory.
“Larry and Jerry had never written a sitcom, and
my department had never developed one,” says Rick
Ludwin. “We were a good match, because we didn’t
know what rules weren’t supposed to be broken.”
©PictureLux/The Hollywood Archive/Alamy Stock Photo
* P. Rosenthal, “NBC Executive Stands Apart by Taking Stands,” Chicago Tribune, August 21, 2005; L. Mellor, “Seinfeld’s Journey from Flop to Acclaimed Hit,” Den
of Geek (London, November 7, 2014), http://www.denofgeek.com (accessed March 6, 2018); S. Austerlitz, “How ‘Seinfeld’ Revolutionized the Sitcom,” IndieWire
(February 28, 2014), http://www.indiewire.com (accessed March 7, 2018); N. J. Nigro, Seinfeld FAQ: Everything Left to Know About the Show About Nothing
(Milwaukee: Applause Theatre and Cinema Books, 2015); A. Grant, Originals: How Non-Conformists Change the World (New York: Viking, 2016), 44–46.
choice view assumes that organizational goals are clear and
agreed upon, yet in reality they are often ambiguous or in
conflict with each other.22 Ambiguous goals make it difficult
to know if a particular choice has greater value to the organization. For example, “satisfy customer needs” may refer to
providing efficient service, a variety of services, more personalized service, and other possibilities. Conflicting goals
also create havoc with rational decision making. When goals
conflict, decision makers need to determine which goal
gets priority. Unfortunately, they rarely have a guide map to
determine which goals take precedence.
The rational choice approach assumes that decision makers
evaluate all alternatives and all of their features and outcomes
simultaneously using unbiased estimates of valences and
outcome probabilities (illustrated earlier in Exhibit 7.1). In
reality, people sequentially (not all at the same time) evaluate
only a few alternatives and only a handful of characteristics.23
For example, there are hundreds of smartphone models on
the market and dozens of features to consider in each model,
yet smartphone purchasers typically pay attention to a small
subset of phones and a handful of characteristics or expected
outcomes of those products.
Furthermore, purchasers rarely line up all of their limited
range of alternatives at the same time to select the best one.
Instead, they typically evaluimplicit favourite A preferred
ate alternatives sequentially
alternative that the decision
using an implicit favourite.
maker uses repeatedly as
An implicit favourite is a
a comparison with other
preferred alternative that
becomes the benchmark
Chapter Seven
Decision Making and Creativity
Rational Choice Assumptions versus Organizational Behaviour Findings about Choosing Alternatives
Rational Choice Paradigm Assumptions
Goals are clear, compatible, and
agreed upon
Decision makers can calculate all alternatives
and their outcomes
Observations from Organizational Behaviour
Goals are ambiguous, in conf lict, and
lack full support
Decision makers have limited information
processing abilities
Decision makers evaluate all alternatives
Decision makers evaluate alternatives
Decision makers use absolute standards to
evaluate alternatives
Decision makers evaluate alternatives
against an implicit favourite
Decision makers use factual information to
choose alternatives
Decision makers process perceptually
distorted information
Decision makers choose the alternative with
the highest payof f
Decision makers choose the alternative
that is good enough (satisf icing)
against which other choices are compared. The preferred
alternative is called “implicit” because decision makers don’t
explicitly decide this initial preference and often aren’t even
aware of their favouritism.24
There are several reasons why decision makers follow
a sequential evaluation process using an implicit favourite.
First, it is often difficult to have all alternatives available at
the same time.25 It is impossible to collect information about
every smartphone product all at once, so the most favourable phone found early in your search becomes the implicit
favourite when considering phones that you investigate later.
Similarly, when filling a job vacancy, some job candidates
would have found other employment before the later applicants have applied or been interviewed. Thus, hiring managers evaluate applicants against an implicit favourite (the best
candidate interviewed so far).
Second, human beings have a natural preference for comparing two choices rather than systematically evaluating
many alternatives at the same time.26 An implicit favourite assists this process by serving as an anchor comparator
for evaluating the other choices. A third reason is that people are cognitive misers. They minimize mental effort by
quickly forming a preferred
alternative (their implicit
confirmation bias The profavourite), and then lookcess of screening out inforing mainly for evidence
mation that is contrary to our
that supports the preferred
values and assumptions, and
choice. In other words,
to more readily accept conthey engage in confirmafirming information.
tion bias (see Chapter 3).27
The fourth reason why decision makers compare alternatives sequentially against an implicit favourite is the human
need for cognitive consistency and coherence. People
want to ensure that their choice is the emotional preference (implicit favourite) as well as the best logical choice.
This alignment of rationality with preference and choice
occurs most easily through sequential analysis of alternatives against an implicit favourite because decision makers
subtly change valences and probabilities. Specifically, they
nonconsciously ignore or underweight positive features of
alternatives relative to the implicit favourite, and change
the importance of factors to support the favourite. If you
discover that the camera on the phone you prefer to buy
(your implicit favourite) has worse reviews than the camera
on another smartphone, you nonconsciously make camera
quality less important (at least while making the decision)
and discount the accuracy of the reviews about camera quality. Ultimately, you distort valences (importance of camera
quality) and probabilities (likelihood that the other phone’s
camera is superior) so your implicit favourite remains the
rational best choice.28
Biased Decision Heuristics
The cornerstone of rational choice decision making is to
calculate the alternative with the highest expected satisfaction. However, psychologists Amos Tversky and
Daniel Kahneman discovered that human beings have
built-in decision heuristics that automatically distort
those calculations. Three of the most widely studied
178 Part Three
Team Processes
heuristic biases are anchoring and adjustment, availability,
and representativeness:29
• Anchoring and adjustment heuristic. This heuristic
states that we are influenced by an initial anchor point
and do not sufficiently
anchoring and adjustment
move away from that
heuristic A natural tendency
point as new information
for people to be influenced
is provided.30 The anchor
by an initial anchor point such
point might be an initial
that they do not sufficiently
offer price, initial opinion
move away from that point as
new information is provided.
of someone, or initial
estimated probability that
something will occur. This bias is associated with the
problem we described a few paragraphs ago, namely
that human beings tend to compare alternatives rather
than evaluate them purely against objective criteria.
Therefore, if someone requests a high initial price
for a car we want to buy, we naturally compare—and
thereby anchor—our alternative offer against that high
initial price.
• Availability heuristic. The availability heuristic is the
tendency to estimate the
availability heuristic A natural
probability of something
tendency to assign higher proboccurring by how easily
abilities to objects or events
we can recall that event.
that are easier to recall from
Unfortunately, how easily
memory, even though ease of
we recall something is due
recall is also affected by nonprobability factors (e.g., emoto several factors, not just
tional response, recent events).
how often it occurs (probability).31 For instance,
we easily remember recent events as well as emotional
events (such as earthquakes and shark attacks), which
causes us to overestimate the probability or frequency of
recent or traumatic events.
• Representativeness heuristic. This heuristic states that
we pay more attention to whether something resembles
(is representative of)
representativeness heusomething else than on
ristic A natural tendency
more precise statistics
to evaluate probabilities of
about its probability.32
events or objects by the
Suppose that one-fifth of
degree to which they resemthe students in your class
ble (are representative of)
are in engineering and the
other events or objects rather
than on objective probability
others are business majors.
Statistically, there is a 20
percent chance that any
individual in that class is an engineering student. Yet, if
one student looks and acts like a stereotype of an engineer, we tend to believe the person is an engineer even
though there is much stronger and more reliable statistical evidence that they are a business major.
One of the main assumptions of rational choice decision
making is that people are both motivated and able to identify
and select the best alternative (maximization). Yet rather than
aiming for maximization, people engage in satisficing—they
choose the first alternative
that exceeds a standard of
satisficing Selecting an alteracceptance for their needs
native that is satisfactory or
and preferences. In short,
“good enough,” rather than
the alternative with the highthey choose an alternative
est value (maximization).
that is “good enough.”
Satisficing is usually
necessary because choosing the absolutely best choice (maximization) requires complete and perfect information. This
is impossible in reality because information is imperfect,
costly, or can’t be found at all when the decision is made.
Hypothetically, even if decision makers could receive complete and perfect information, they wouldn’t have the time or
cognitive capacity to input and analyze the mammoth amount
of complex data. For example, it is difficult to choose the best
possible smartphone because of the large number of choices,
the many features to consider for each choice, the numerous consequences of each choice (time to first breakdown,
system update limits, etc.), and the ambiguous information
about many of those features and outcomes. Under those
conditions, maximization leads to a spiral of endless tradeoffs among the various choices, which can actually result in
worse decisions and less satisfied decision makers.34
Studies report that people like to have choices, but deciding from among dozens of alternatives and many outcomes
for each alternative is cognitively and emotionally draining.
Consequently, decision makers satisfice as a way to minimize
cognitive effort.35 They also reduce cognitive effort by discarding a large selection of alternatives using easily identifiable factors (colour, size, etc.) and by evaluating them using
only a handful of possible outcomes (selection criteria).
People who face a large number of alternatives often opt
for a decision strategy that is even less cognitively challenging than satisficing: They don’t make any decision at all! In
one study, grocery store customers saw one of two jam-tasting booths. Thirty percent of consumers who visited the booth
displaying six types of jam purchased one of those products.
In contrast, only 3 percent of customers who saw the booth
displaying 24 types of jam made a purchase. The larger number of choices discouraged them from making any decision.
Other studies revealed similar results in decisions about chocolates, term essays, and pension plan investment options.36
Opportunities are just as important as problems, but the process
of acting on an opportunity differs from the process of solving a
Chapter Seven
Decision Making and Creativity
People avoid making choices in decisions that have too many alternatives. This is evident when new employees are
asked to register for their pension plan and choose one type of investment. More employees delay or avoid pension
plan registration when they face dozens of investment options, even though signing up would give them tax benefits,
company contributions to that plan, and long-term financial security. Studies have found that employees are significantly
more likely to register for the company pension plan when they are given only two or three initial investment options,
such as a growth fund, balanced fund, and capital stable investment. After they have signed up, employees are
presented with further investment choices for their pension plan.*
* S. Iyengar, The Art of Choosing (New York: Hachette, 2010), 194–200; J. Beshears et al., “Simplification and Saving,” Journal of Economic Behavior &
Organization 95 (2013): 130–45.
problem. Decision makers seldom evaluate several alternatives
when they find an opportunity; after all, the opportunity is the
solution, so why look for others! An opportunity is usually
experienced as an exciting and rare revelation, so decision makers tend to develop an emotional attachment to the opportunity.
Unfortunately, this emotional preference motivates decision
makers to apply the opportunity and short-circuit any detailed
assessment of its potential benefits. Furthermore, studies indicate that decision makers tend to personalize an opportunity
(i.e., it belongs to them) rather than remain impartial evaluators of the opportunity. This ownership mindset makes impersonal analysis of the opportunity even more difficult.37
Emotions and Intuition in
Decision Making
The previous sections of this chapter explained why people
are far from perfect at rational decision making. However,
Herbert Simon and other scholars who studied imperfect
rationality neglected to mention another problem: The rational choice model completely ignores the effect of emotions
in human decision making. Just as both the rational and emotional brain centres alert us to problems, they also influence
our choice of alternatives.38 Emotions affect the evaluation
of alternatives in three ways.
Emotions Form Early Preferences
The emotional marker process described earlier in this book
(Chapters 3, 4, and 5) shapes our preferences for alternatives
before we consciously evaluate them. Our brain very quickly
attaches specific emotions to information about each alternative, and our preferred alternative is strongly influenced by
those initial emotional markers.39 Of course, logical analysis
also influences which alternative we choose, but it requires
strong logical evidence to change our initial preferences (initial emotional markers). Yet even logical analysis depends
on emotions to sway our decision. Specifically, neuroscientific evidence says that information produced from logical
analysis is tagged with emotional markers, and it is those
180 Part Three
Team Processes
emotional markers, not logical analysis, that motivate us to
choose or avoid a particular alternative. In other words, emotions, not rational logic, energize us to make the preferred
choice. In fact, people with damaged emotional brain centres
have difficulty making choices.
Emotions Change the Decision
Evaluation Process
Moods and specific emotions influence the process of evaluating alternatives.40 For instance, we pay more attention to
details when in a negative mood, possibly because a negative mood signals that there is something wrong that requires
attention. When in a positive mood, on the other hand, we
pay less attention to details and rely on a more programmed
decision routine. This phenomenon explains why executive
teams in successful companies are often less vigilant about
competitors and other environmental threats.41 Research also
suggests that when angry, decision makers rely on stereotypes and other shortcuts to speed up the decision process.
Anger also makes them more optimistic about the success of
risky alternatives, whereas the emotion of fear tends to make
them less optimistic. Overall, emotions shape how we evaluate information, not just which choice we select.
Emotions Serve as Information
When We Evaluate Alternatives
The third way that emotions influence the evaluation of
alternatives is through a process called “emotions as information.” This refers to the idea that we listen in on our
emotions to acquire guidance when making choices.42 The
emotions-as-information effect is similar to having a temporary improvement in emotional intelligence. Most emotional
experiences remain below the level of conscious awareness,
but people actively try to be more sensitive to these subtle
emotions when making a decision.
When buying a new car, for example, you not only logically evaluate each vehicle’s features; you also try to gauge
your emotions when visualizing what it would be like to
own each of the cars on your list of choices. Even when you
have information about each vehicle (purchase price, fuel
efficiency, maintenance costs, resale value, etc.), you are
swayed by your emotional reaction and actively try to sense
that emotional response when thinking about the decision.
Everyone pays attention to their emotions to some degree
when choosing alternatives. This phenomenon ties directly
into our next topic, intuition.
Do you get a gut feeling when something isn’t quite right?
Or perhaps a different emotional experience occurs when
you sense an opportunity? These emotional events potentially (but not necessarily) indicate your intuition—the
ability to know when a problem or opportunity exists and
to select the best course of
action without conscious
intuition The ability to know
when a problem or opportureasoning.43 Some people
nity exists and to select the
pay more attention to their
best course of action without
gut feelings whereas others
conscious reasoning.
are more comfortable with
decisions based on logic
and data analysis. However, intuition and logical analysis are
not opposites and never completely replace each other. Both
are always present in human decision making.44
Intuition is both an emotional experience and a rapid
nonconscious analytic process. The gut feelings we experience are emotional signals that have enough intensity to
make us consciously aware of them. These signals warn us
of impending danger or motivate us to take advantage of
an opportunity. Some intuition also directs us to preferred
choices relative to other alternatives in the situation.
All gut feelings are emotional signals, but not all emotional signals are intuition. Emotional signals are valid intuition when they rely on mental models that reasonably and
accurately depict the situation where we sense the problem
or opportunity. Intuition involves rapidly comparing our
observations with these “templates of the mind.” Positive or
negative emotions are produced, depending on how well that
situation fits our mental model.45 For example, when chess
masters quickly scan a chessboard, they experience emotional signals that the chess configuration poses an opportunity or threat. These emotional signals motivate closer
observation to logically confirm the situation and to act on
it. Thus, intuition signals that a problem or opportunity exists
long before conscious rational analysis has occurred.
However, not all emotional signals are intuition because
they are not always based on well-grounded mental models. Instead, we sometimes compare the current situation to
more remote templates, which may or may not be relevant.
A new employee might feel confident about relations with
a supplier, whereas an experienced employee senses potential problems. The difference is that the new employee relies
on poorly developed or more remote templates from other
experiences that might not fit this situation. Thus, the extent
What is your preferred decision-making style? You can discover your preference for logical or
intuitive decision making by locating this self-assessment in Connect.
Chapter Seven
Decision Making and Creativity
Intuition versus Data Analysis: Crunch Your Hunch*
of 250 senior business leaders
in Canada agree or somewhat agree that a
business leader must go with their gut and
intuition when an important decision needs
to be made quickly.
of 1,300 CEOs of companies
in the 11 largest economies say that within
the past three years they have overlooked
data-based insights and models because
they contradicted their intuition.
of 207 C-suite executives
in Canada say their next big decision will
likely be based on human judgment
(compared to 59% of 1,900 executives
of 207 C-suite executives
in Canada say their decision making is
highly data driven (compared to 39% of
1,900 executives globally).
of 250 senior business leaders
in Canada say they rely too much on intuition
and not enough on data and analytics when
making decisions (53% said they rely too much
on data and analytics).
©Robert Lucian Crusitu/Shutterstock
* “Intuition in the Age of Big Data,” Smith School of Business, Queen’s University, Smith Business Insight (blog), June 21, 2016, https://smith.queensu.ca/insight/
content/intuition-in-the-age-of-big-data.php; “Big DecisionsTM Global Data and Analytics Survey 2016: Canadian Insights” (Toronto: PricewaterhouseCoopers, July
2016); “Growing Pains: 2018 Global CEO Outlook” (Zurich: KPMG International, May 2018).
to which our gut feelings represent intuition in a specific
situation depends on our level of experience in that setting.
The key message here is that some emotional signals are not
intuition, so gut feelings alone shouldn’t guide our decisions.
So far, we have described intuition as an emotional experience (gut feeling) and a process in which we compare
the current situation with well-established templates of the
mind. Intuition also relies on action scripts that speed up our
response to pattern matches or mismatches.46 Action scripts
are programmed decisions; they shorten the decision-making
process by jumping from problem identification to selection
of a solution. Action scripts are also generic, so we need to
consciously adapt them to the specific situation.
It is very difficult to get around the human limitations of making choices, but a few strategies can minimize these problems. One important discovery is that decisions tend to have
a higher failure rate when leaders are decisive rather than
contemplative about the available options. Of course, decisions can also be ineffective when leaders procrastinate in
decision making, but research indicates that a lack of logical
evaluation of alternatives is a greater concern. This recommendation does not suggest that we ignore intuition; rather,
it suggests that we use it in combination with careful analysis
of relevant information. By systematically assessing alternatives against relevant factors, decision makers minimize the
implicit favourite and satisficing problems that occur when
they rely on general, subjective judgments. For instance, one
recent study of patient flow decisions in Canadian hospitals
found that the best choices occurred through systematic
discovery and evaluation of alternative interventions. Yet
most hospital leaders and committees did the opposite; they
selected a myriad of pet projects and a patchwork of multiple alternatives without evaluating or comparing their likely
A second recommendation is to revisit important problems and opportunities at another time so information is
reviewed when decision makers are in different moods
and have allowed time for their initial emotions to subside.
For example, if you sense that your team is feeling too confident when making an important decision, you might decide
to have the committee revisit the decision a few days later
when its members are thinking more critically.
182 Part Three
Team Processes
A related strategy is scenario planning, which is a disciplined method for imagining possible futures.48 It typically involves thinking
scenario planning A systemabout what would happen
atic process of thinking about
if a significant environalternative futures and what
mental condition changed
the organization should do to
and what the organization
anticipate and react to those
should do to anticipate and
react to such an outcome.
Scenario planning is a useful vehicle for choosing the best
solutions under possible scenarios long before they occur,
because alternative courses of action are evaluated without
the pressure and emotions that occur during real emergencies.
Implementing and Evaluating
Implementing decisions is often skipped over in most writing
about decision making. Yet leading business writers emphasize that execution—translating decisions into action—is
one of the most important and challenging tasks in the decision-making process.49 Implementing decisions is mainly
about organizational change, which we discuss in Chapter
15, but also relates to motivation (Chapter 5), influence processes (Chapter 10), leadership (Chapter 12), and several
other themes throughout this book.
Contrary to the rational choice view, decision makers aren’t
completely honest with themselves when evaluating the effectiveness of their decisions. Earlier in this chapter, we explained
that decision makers engage in confirmation bias to support
their implicit favourite and to maintain consistency in their
preference and decision. This bias continues long after the decision has been made; during the evaluation stage it is also known
as postdecisional justification.50 Decision makers ignore or
underemphasize negative outcomes of the choice they made
and overemphasize new information about its positive features.
Postdecisional justification gives people an excessively
optimistic evaluation of their decisions, but only until they
receive very clear and undeniable information to the contrary.
escalation of commitment
The tendency to repeat an
apparently bad decision or
allocate more resources to
a failing course of action.
Another reason why decision makers don’t evaluate
their decisions very well
is due to escalation of
commitment—the tendency
to repeat an apparently bad
decision or allocate more resources to a failing course of
action.51 Why are decision makers led deeper and deeper
into failing projects? Several explanations have been identified and discussed over the years, but the four main influences are self-justification effect, self-enhancement effect,
prospect theory effect, and sunk costs effect.
Self-Justification Effect
People try to convey a positive public image of themselves.
In decision making, this self-justification typically involves
appearing to be rational and competent. Decision makers are
therefore motivated to demonstrate that their choices will be
successful, which includes continuing to support a decision
even when it is not having the desired outcomes. In contrast, pulling the plug symbolizes the project’s failure and the
decision maker’s incompetence. This self-justification effect is
particularly evident when decision makers are personally identified with the project, have staked their reputations to some
extent on the project’s success, and have low self-esteem.52
Self-Enhancement Effect
People have a natural tendency to feel good about themselves—to feel luckier, more competent, and more successful than average—regarding things that are important to
them (see Chapter 3).53 This self-enhancement supports a
positive self-concept, but it also increases the risk of escalation of commitment. When presented with evidence that
a project is in trouble, self-enhancement biases our interpretation of the information
self-enhancement A person’s
as a temporary aberration
inherent motivation to have
from an otherwise positive
a positive self-concept (and
trend line. And when we
to have others perceive them
eventually realize that the
favourably), such as being
project isn’t going as well
competent, attractive, lucky,
ethical, and important.
as planned, we continue
to invest in the project
because our self-enhancement overestimates the probability
that we can rescue the project. Self-justification and self-enhancement often occur together, but they are different mechanisms. Self-justification is a deliberate attempt to maintain
a favourable public image, whereas self-enhancement nonconsciously distorts our perceptions so problems are recognized later, and our probabilities of success are biased so we
continue to invest in the losing project.54
Theory Effect
Prospect theory effect is
the tendency to experience
stronger negative emotions
when losing something of
prospect theory effect An
innate tendency to feel stronger negative emotion from
losing a particular amount
than positive emotion from
gaining an equal amount.
Chapter Seven
value than positive emotions when gaining something of equal
value. This is also known as loss aversion because we have a
stronger motivation to avoid losses than to risk receiving equally
valuable gains. The stronger negative valence of a potential loss
motivates escalation of commitment because stopping a project is a certain loss, which evokes more negative emotions than
the uncertainty of success associated with continuing to fund
the project. Given the choice, decision makers choose escalation
of commitment, which is the less painful option at the time.55
Sunk Costs Effect
People inherently feel motivated to invest more resources in
projects that have high sunk costs—the value of resources
already invested in the decision.56 This contrasts with the
rational choice view, which states that investing resources
should be determined by expected future gains and risk, not
by the size of earlier resources invested in the project. A variation of sunk costs is time investment. Time is a resource, so
the more time decision makers have devoted to a project, the
more motivated they are to continue investing in that project.
Finally, sunk costs can take the form of closing costs, that is,
the financial or nonfinancial penalties associated with shutting down a project. As with other forms of sunk costs, the
higher the closing costs, the more motivated decision makers
are to engage in escalation of commitment.
Escalation of commitment is usually framed as poor decision making, but adding more resources to a losing project may be beneficial under some circumstances.57 Indeed,
many breakthroughs have occurred because of the decision
maker’s persistence and optimism. Continuing with a losing
project may be prudent when the cost overruns are small
relative to the project cost, the benefits of success are high,
and the rewards of a successful project are received quickly.
Some experts also suggest that throwing more money into a
failing project may be a logical attempt to further understand
an ambiguous situation. By adding more resources, the decision maker gains new information about the effectiveness of
these funds, which provides more feedback about the project’s future success. This strategy is particularly common
where the project has high closing costs.
Several strategies have been identified to minimize escalation of commitment and postdecisional justification.58
• Change the decision maker. Decision evaluation biases
are often minimized when those who made the original
decision are replaced by those who later evaluate and
act on that evaluation. This strategy works best when the
decision evaluators have limited alliance with those who
Decision Making and Creativity
made the decision. It minimizes the self-justification
effect because the person responsible for evaluating the
decision is not connected to the original decision.
• Create a stop-loss. Publicly establishing a preset level at
which the decision is abandoned or re-evaluated forces
the decision maker to abandon the investment if its value
falls or cost overruns increase beyond a set level. The
problem with this solution is that conditions are often
so complex that it is difficult to identify an appropriate
point to abandon a project.
• Seek factual and social feedback. At some point, even
the strongest escalation and confirmation bias effects
collapse when the decision maker is faced with systematic and clear feedback about the project’s failings. In
addition, the decision maker can benefit from ongoing
feedback from several (preferably impartial) people.
Feedback from others might result in earlier awareness
of problems. By relying on advice from several people,
the decision maker might also have less psychological
attachment to any recommendation to cancel the project.
• Change the decision maker’s mindset. There is growing
evidence that decision makers are less likely to engage
in escalation of commitment if they change their mindset
regarding the situation. In one recent study, a 15-minute
meditation recording reduced escalation of commitment by refocusing the decision maker’s attention away
from the negative emotions of the project’s past financial losses. A second study found that decision makers
were more likely to terminate failing projects when they
focused on growing the business rather than on maintaining past obligations or preventing losses in past decisions.
As the opening case study to this chapter described, creativity has
become a central feature of decision making at Atlantic Lottery
Corporation. Creativity refers to the development of original
ideas that make a socially
recognized contribution.59
creativity The development
It exists when imagining
of original ideas that make
a socially recognized
opportunities, such as how a
company’s expertise might
be redirected to untapped
markets. Creativity is present when developing alternatives, such
as discovering new products or services, or recognizing problems that are not easily apparent from traditional perspectives.
Creativity also helps us to develop and choose alternatives by
visualizing the future in different ways and figuring out how each
choice might be useful or a liability in those scenarios. In short,
creativity is valuable throughout the decision-making process.
184 Part Three
Team Processes
The Creative Process Model
• Understand the problem
or opportunity
• Investigate information
that seems relevant
to the issue
• Period of reflective
• Nonconscious or
low-level awareness,
not direct attention
to the issue
• Active divergent
thinking process
How does creativity occur? That question has puzzled experts
for centuries and has fascinated scientists who saw how creative thinking contributed to their own important discoveries.
Notably, more than a century ago, German physicist Hermann
von Helmholtz gave a public talk describing the process that
led to his innovations (energy physics, instruments for examining eyes, and many others). A few decades later, London
School of Economics professor Graham Wallas built on
Helmholtz’s ideas to construct the four-stage model shown
in Exhibit 7.4.60 To this day, this model is still considered the
most elegant representation of the creative process.
The first stage is preparation—the process of investigating the problem or opportunity. Preparation involves
developing a clear understanding of what you are trying to
achieve through a novel solution and then actively studying
information seemingly related to the topic. It is a process of
developing knowledge and possibly skills about the topic.
The second stage, called incubation, is the period of reflective thought. We put the problem aside, but our mind is still
working on it in the background.61 The important condition
here is to maintain a low-level awareness by frequently revisiting the problem.
Incubation assists divergent thinking—reframing
divergent thinking Reframing
the problem in a unique
a problem in a unique way
way and generating differand generating different
ent approaches to the issue.
approaches to the issue.
Divergent thinking breaks
• Sudden awareness of
a novel, although
vague and incomplete,
idea entering one’s
• May include an
initial period of
“fringe” awareness
• Detailed logical
and experimental
evaluation of the
illuminated idea
• Further creative
us away from existing mental models so that we can apply
concepts or processes from completely different areas of
life. This contrasts with convergent thinking, which involves
calculating the conventionally accepted “right answer” to a
logical problem.
The invention of Velcro illustrates how divergent thinking
occurs.62 In the 1940s, Swiss engineer Georges de Mestral
had just returned home from a walk with his dog through the
countryside when he noticed that his clothing and the dog’s
fur were covered in burrs. While struggling to remove the
barbed seeds, de Mestral engaged in divergent thinking by
recognizing that the adhesion used by burrs could be used to
attach other things together. It took another dozen years of
hard work, but de Mestral eventually perfected the hook-andloop fastener, which he trademarked as Velcro.
Illumination (also called insight), the third stage of creativity, refers to the experience of suddenly becoming aware
of a unique idea.63 Wallas and others also suggest that this
stage begins with a “fringe” awareness before the idea fully
enters our consciousness. Illumination is often visually
depicted as a light bulb, but a better image would be a flash
of light or perhaps a briefly flickering candle—these bits of
inspiration are fleeting and can be quickly lost if not documented. For this reason, many creative people keep a journal
or notebook nearby so they can jot down their ideas before
they disappear. Also, flickering ideas don’t keep a particular
schedule; they might come to you at any time of day or night.
Illumination presents ideas that are usually vague, roughly
drawn, and untested. Therefore, the essential final stage of creativity
is verification, whereby we flesh out the illuminated ideas and
How well do you engage in divergent thinking? You can discover the extent to which you have
divergent thinking by locating this self-assessment in Connect.
Chapter Seven
Decision Making and Creativity
©SFIO CRACHO/Shutterstock
Employees at Halifax-based Bluedrop Training and Simulation engage in divergent thinking to design and develop stateof-the-art training and simulation products. Tushar Sehgal describes one such incident. The Bluedrop technical project
manager and a co-worker were shopping at Home Depot when they saw a black pipe coupling product. They soon
realized that it could become the hand tracking mechanism they needed for Bluedrop’s prototype of the world’s first
virtual-reality helicopter crew trainer. “It was one of those ‘aha’ moments,” says Sehgal. “We put that around our wrists as
a joke and then realized, wait, this is going to work.” The employees bought two of them, drilled holes, attached markers,
and found out that the item worked nicely. “There [are] many stories like that inspiration coming from random parts and
random shopping trips,” Sehgal observes.*
*Based on information in: T. Ayres, “Helicopter Simulator Accompanies CH-148 Cyclones,” Halifax Chronicle-Herald, February 24, 2018, B1.
subject them to systematic and detailed experimentation and
evaluation. This stage often calls for further creativity as the
ideas evolve into finished products or services. Thus, although
verification is labelled the final stage of creativity, it is really
the beginning of a long process of creative decision making
toward development of an innovative product or service.
Everyone is creative, but some people have a higher potential
for creativity. Four of the main characteristics that give individuals more creative potential are intelligence, persistence,
knowledge and experience, and a cluster of personality
traits and values representing independent imagination (see
Exhibit 7.5).
• Cognitive and practical intelligence. Creative people
have above-average cognitive intelligence to synthesize and analyze information as well as apply their
ideas.64 They recognize the significance of small bits
of information and are able to connect them in ways
that few others can imagine. They also have practical
intelligence—the capacity to evaluate the potential
usefulness of their ideas.
• Persistence. Creative people have persistence, which is
based on a high need for achievement, a strong motivation from the task itself, and moderate or higher
self-esteem. Persistence is vital because people need
this motivation to continue working on and investing in
a project in spite of failures and advice from others to
quit. In fact, people have a general tendency to dismiss or
criticize new ideas, so creative people need persistence to
withstand these negative social forces.65
• Knowledge and experience. Creative people require a
foundation of knowledge and experience to discover or
acquire new knowledge.66 However, this expertise is a
double-edged sword. As people acquire specific knowledge and experience, their mental models about that
topic tend to become more rigid. They are less adaptable to new information or rules about that knowledge
186 Part Three
Team Processes
Characteristics of Creative People
• High openness to experience
• Moderately low need for
af f iliation
• Strong self-direction value
• Strong stimulation value
Knowledge and
Cognitive and
Practical Intelligence
• Ability to synthesize, analyze,
and apply ideas
• Ability to evaluate potential
usefulness of ideas
Characteristics of
Creative People
• Prerequisite knowledge
and experience
• Not locked into a fixed
knowledge mindset
domain. Some writers suggest that expertise also
increases “mindless behaviour” because it reduces the
tendency to question why things happen.67 To overcome
the limitations of expertise, some corporate leaders
like to hire people from other industries and areas of
expertise. For instance, when the late Geoffrey Ballard,
founder of Burnaby, B.C.–based Ballard Power Systems,
hired a chemist to develop a better battery, the chemist
protested that he didn’t know anything about batteries.
Ballard replied: “That’s fine. I don’t want someone who
knows batteries. They know what won’t work.”68
• Independent imagination. Creative people possess a
cluster of personality traits and values that support an
independent imagination: high openness to experience,
moderately low need for affiliation, and strong values
around self-direction and stimulation.69 Openness to
experience is a Big Five personality dimension representing the extent to which a person is imaginative, curious,
sensitive, open-minded, and original (see Chapter 2).
Creative people have a moderately low need for affiliation so they are less embarrassed when making mistakes. Self-direction includes the values of creativity and
independent thought; stimulation includes the values of
excitement and challenge. Together, these values form
openness to change—representing the motivation to pursue innovative ways of solving problems (see Chapter 2).
• High need for
• Strong task motivation
• Moderately high selfesteem and optimism
Intelligence, persistence, expertise, and independent imagination represent a person’s creative potential, but the extent
to which these characteristics produce more creative output
depends on how well the work environment supports the
creative process.70 Several job and workplace characteristics
have been identified in the literature, and different combinations of situations can equally support creativity; there isn’t
one best work environment.
One of the most important conditions for creativity is a
learning orientation.71 A learning orientation is a set of collective beliefs and norms that encourage employees to question
past practices, to learn new
learning orientation A set of
ideas, to experiment putting
collective beliefs and norms
ideas into practice, and to
that encourage people to
view mistakes as part of the
question past practices, learn
learning process. “My attinew ideas, experiment putting
tude is that a failure should
ideas into practice, and view
mistakes as part of the learnbe greeted with an ‘Attaboy,
ing process.
attagirl, we’ve learnt something; move forward, let’s
innovate with that learning,” says Anthony Viel, CEO of
Deloitte Canada. “If you don’t create that culture, then fear
can cripple or stifle innovation within your organization.”72
Do you have a creative personality? You can discover the extent to which you have a disposition for
creative thinking by locating this self-assessment in Connect.
Chapter Seven
Decision Making and Creativity
Global Connections 7.3
Creativity is key to Estée Lauder’s success as the global
leader in the prestige beauty industry. “To be clear, creativity is at the center of our innovation models,” emphasizes Fabrizio Freda, CEO of the New York–based
cosmetics and skin care firm. “So while we listen to the
consumer and study trends, the majority of our effort is
directed at inventing things that don’t exist.”
Estée Lauder’s creative focus begins with the view
that creativity is important in every job. “Creativity is
about solving problems, and who doesn’t solve problems on a daily basis?” asks Mark Polson, Estée Lauder’s
vice president of creativity and business innovation.
“Therefore, everybody by virtue of their innate problem
solving skills, is creative.”
Along with encouraging every employee to be creative, Estée Lauder supports creativity by nurturing a
learning orientation culture. Mark Polson explains that
he and other Estée Lauder leaders “do that by creating
an environment that doesn’t punish failure, but looks to
learn from the lessons of failure.”
Estée Lauder also supports creativity through training programs and creative activities. For instance, the
company hosts design thinking sessions with product
developers, engineers, customer-facing employees,
and other groups. “We bring them together, put the
problem on the table, break them into teams and just let
them come up with ideas and put prototypes together.
Then we evaluate them, and iterate and do more prototypes,” Polson explains.
* J. Anixter, “Mark Polson, Creativity and Estee Lauder—The IX Interview,” Innovation Excellence (blog), February 16, 2015, https://www.innovationexcellence.com/blog/2015/02/16/mark-polson-creativity-and-estee-lauder-the-ix-interview/; “Estée Lauder Companies: A Home for Creative Talent,” The
Business of Fashion, February 2, 2017; L.R. Rublin, “Shaking Up the Prestige Beauty Business,” Barron’s, June 1, 2018; S. Castellanos, “Estée Lauder
Revamps IT, Merging Beauty Business With Innovation,” The Wall Street Journal, March 20, 2019.
A second contributor to creativity is job design, specifically task significance and autonomy. People are more
creative when they believe their work improves the organization or society and when they have the freedom to pursue
novel ideas without bureaucratic delays.73 Creativity is about
changing things, and change is possible only when employees have the autonomy and authority to experiment.
Along with a learning orientation and enriched jobs, creativity blossoms through open communication (enabling
employees to share ideas and information) and sufficient
resources. Organizations also nurture creativity by providing a comfortable degree of job security, which explains why
creativity suffers during times of downsizing and corporate
restructuring.74 Some companies also support creativity by
designing nontraditional workspaces, such as a unique building design or unconventional office areas.75 Google is one
example. The Internet innovator has funky offices in several
countries that include hammocks, slides, brightly painted
walls, and privacy spaces that look like gondolas and beehives.
To some degree, creativity also improves with support from leaders and co-workers.76 Generally, creativity
thrives when leaders have an appealing vision of the future
and encourage employees to experiment with new ways
to achieve that vision (see transformational leadership in
Chapter 12). Co-worker support can improve creativity, but
a few studies suggest that competition among co-workers
improves creativity under some conditions. Similarly, it isn’t
clear how much pressure should be exerted on employees
to produce creative ideas. Extreme time pressures are wellknown creativity inhibitors, but lack of pressure doesn’t
seem to produce the highest creativity, either.
We have described two cornerstones of creativity in organizations: employing people with strong creative potential and
providing a work environment that supports creativity. The
188 Part Three
Team Processes
third cornerstone consists of activities that help employees
think more creatively. Four types of creativity-building activities are: redefine the problem, associative play, cross-pollination, and design thinking.
Redefine the Problem
Redefining the problem is a potentially powerful way to
unleash creative thinking. One approach is to revisit projects that have been set aside. After a period of neglect, these
projects might be seen in new ways.77 You can also see the
problem from different perspectives by asking co-workers
unfamiliar with the issue to explore the problem. You state
the objectives and give some facts and then let the other
person ask questions to further understand the situation. By
verbalizing the problem, listening to questions, and hearing
what others think, you are more likely to form new perspectives on the issue.78
Associative Play
Associative play literally involves playing games or being
challenged in unusual ways.79 One form of associative play
is to engage in playful activities, such as completing a treasure hunt in which the clues are ambiguous rhymes. Creative
thinking emerges naturally from these playful activities and
then carries over to work-related problem solving. A second
variation is challenging participants to create something new
with a specific purpose (e.g., cleaning cutlery) using existing
unrelated products (e.g., blow dryer and electric toothbrush).
These activities exercise the mind to break out of traditional
mental models about existing products and services.
A third variation of associative play, called morphological analysis, involves systematically investigating all combinations of characteristics of a product, service, or event, and
then looking at the feasibility of each combination.80 This
exercise encourages people to carefully examine combinations that initially seem nonsensical. For instance, employees
at a dairy company might look at all combinations of yogurtbased products by considering the contents (fruit, low fat,
etc.), occasion (breakfast, dessert, etc.), target group (children, older adults, etc.), size, and packaging. A novel, yet
commercially successful, innovation may emerge from the
resulting list.
Cross-pollination occurs when people from different areas
of the organization exchange ideas or when new people are
brought into an existing team.81 This may occur by arranging
formal social gatherings, encouraging happenstance interactions with people from other work areas or, as a few firms do,
asking employees to move their desks every few months to
another location with employees who are only acquaintances.
Creative agency Mother is famous for encouraging creativity through cross-pollination at its offices in London,
New York, and elsewhere. “Everyone sits together around the
same table, and every six weeks, on ‘Move Monday,’ we all
change places,” explains Mother’s creative director and head
of strategy. The company produces a new seating plan where
employees are redistributed; most of the London crew sit
around a mammoth concrete slab that accommodates more
than 100 people. “There’s no rules in terms of seniority or
discipline, and it means that everybody gets to know each
other and ideas can be cross-pollinated.”82 Cross-pollination
highlights the fact that creativity rarely occurs alone. Some
creative people may be individualistic, but most creative ideas
are generated through teams and informal social interaction.
Design Thinking
The opening case study for this chapter described how Atlantic
Lotteries Corporation is transforming the way it makes decisions and develops new products by applying design thinking
principles and practices. Design thinking is a human-centred,
design thinking
process that applies both
A human-centred, solutionintuition and analytical
focused creative process that
thinking to clarify problems
applies both intuition and
and generate innovative
analytical thinking to clarify
solutions. Contrary to its
problems and generate
label, design thinking isn’t
innovative solutions.
just for people in design
jobs. Rather, it is a tangible scaffolding that guides all employees
through the decision-making process using creative thinking,
logical analysis, empathy, and intuition.
There are several models and guidelines for design thinking, but one of the most respected frameworks identifies the
four rules outlined in Exhibit 7.6 and summarized below:83
• The Human Rule. Design thinking is a team activity. It
depends on collaboration and co-creation among several
people with diverse knowledge and experiences, so the
issue and its possible solutions are viewed from several
angles. Design thinking is also human-centred because
designers need to empathize with clients and end users
and involve them in the design process.84 Client involvement facilitates redefinition of the original problem statement (such as the client’s briefing) and more dynamic
discovery and refinement of potential solutions. As ideas
and prototypes develop, clients and end users can provide
real-time feedback on the product experience.
• The Ambiguity Rule. Creativity and experimentation are
possible only when there is ambiguity in the problem
and its potential solutions.85 Therefore, design thinkers
preserve ambiguity rather than seek clarity too quickly.
Designers do not assume the client’s original problem
Chapter Seven
Decision Making and Creativity
Four Rules of Design Thinking
Design thinking rule
Human Rule
• Involve several people so the issue and possible solutions are viewed from several angles.
• Include clients and end users to enable an iterative process of problem identification and solution
Ambiguity Rule
• Preserve ambiguity rather than seek clarity too quickly.
• Question and refine the stated problem.
• Develop more than one solution to the problem.
Redesign Rule
• Review past solutions to understand how those inventions tried to satisfy human needs.
• Use foresight tools to imagine better solutions for the future.
Tangible Rule
• Build several low-cost prototypes to test ideas.
• Don’t analyze alternatives at a purely conceptual level.
• Tolerate failure; embrace a learning orientation.
statement is accurate. Instead, the stated problem is questioned and refined with the client. Design thinkers also
avoid the natural temptation to solve the problem too
quickly with one solution. Instead, they continually question possible solutions even after one seems likely. They
also develop more than one solution to the problem.
• The Re-Design Rule. No creative solution is completely
original. Therefore, designers review past solutions to
understand how well they worked as well as their flaws
and limitations. Designers then use foresight tools to imagine better solutions for the future. Environmental scanning,
context mapping, and other foresight tools help designers
visualize possible futures, such as emerging trends and
changes to conditions and rules of the future context.
• The Tangible Rule. The design thinking process devotes
less time to planning and more time to action. Designers
build several low-cost prototypes of their ideas rather
than analyze those ideas at a purely conceptual level.86
Prototypes represent a rich form of communication that
does not exist in conceptual planning. One design thinking
mantra is “fail fast, fail often,” meaning that prototypes are
made quickly and frequently along the journey to the final
result. This statement also recognizes that design thinking
tolerates failure and embraces a learning orientation.
Employee Involvement in
Decision Making
Watson, IBM’s cognitive technology platform, received
a substantial boost when the company launched Cognitive
Build. This three-month event relied on various forms of
employee involvement to determine how Watson’s artificial
intelligence could assist a myriad of corporate and societal objectives. More than 8,000 teams of IBM employees
explored the technology’s application for data security, air
quality monitoring, anti-bullying, social banking, and other
themes. One-third of those teams progressed to Cognitive
Build’s next stage of a completed proposal with some prototyping. IBM employees each received $2,000 in virtual
money through the company’s internal funding system to
“invest” in one or more projects. In effect, they voted on the
best projects. The 50 teams with the most virtual investment
dollars were given three weeks to build their prototypes,
which were then presented to a panel of experts.87
IBM’s Cognitive Built challenge applied various forms
of employee involvement—activities in which employees
participate in and influence decisions about their jobs, work
units, or organization.88 Employee involvement exists when
employees actually influence decisions to some degree. The
distinction is that some situations give employees a voice, yet
their ideas and arguments are never actually considered by
management or others who control the decisions.
Employee involvement has become a natural process in
every organization, but the level of involvement varies with
the situation.89 A low level of involvement occurs when
employees are individually asked for specific information
but the problem is not described to them. Somewhat higher
involvement occurs when the problem is described and
employees are asked individually or collectively for information relating to that problem.
Moving further up the involvement scale, the problem is described to employees, who are collectively given
190 Part Three
Team Processes
Most organizational experts recommend some degree of
employee involvement, but a few go further by proposing
that organizations should operate like democracies rather
than hierarchical fiefdoms. Organizational democracy consists of the highest form of involvement, whereby employees have real institutionalized control—either directly or
through representation—over organizational decisions. In
addition, no one in a democratic enterprise holds higher
authority except where such power is explicitly granted by
the others (such as through employee election of the company’s leaders). Democracy also gives all organizational
members protection against arbitrary or unjust decisions
(such as protection against being fired without cause).
Some readers might view workplace democracy as an
extreme way to run an organization, but advocates point out
that it is the principle on which many societies have operated for centuries and most others aspire to. Democratic
governance has been established in several high-profile
and successful companies, such as Semco SA and W. L.
Gore & Associates, as well as many employee-owned firms
and worker co-operatives. Legislation in several countries
(particularly in continental Europe) requires companies to
give employees control over some organizational decisions through works councils or board membership.**
Advocates point out that, as a form of participation, workplace democracy can improve the quality of organizational
decisions and employee commitment to those decisions.
Indeed, democracy inherently promotes shared leadership
(where everyone should be a leader in various ways), which is
increasingly recommended for improved decision making and
organizational effectiveness. Democratic enterprises might also
be more flexible and innovative. Rather than obediently following management’s standard operating procedures, employees
in democratic organizations have the opportunity—and likely
the expectation—to adapt and experiment with new work
practices as circumstances change. This form of organization
also encourages more organizational learning.***
A final argument is that the democratic enterprise is ethically superior to the traditional hierarchical organization.****
It respects individual rights and dignity, more fully satisfies
the standards of ethical conduct, and is more likely than
traditional management to adopt the multiple stakeholder
approach expected by society. Indeed, some European
governments have debated the notion that organizational
democracy is a potentially effective way to minimize corporate wrongdoing because it actively monitors top decision
makers and continually holds them accountable for their
However, the democratic enterprise model has a number
of vocal advocates, but few practitioners. There is somewhat more employee involvement in most organizations
today than a few decades ago, but it is still far from the democratic ideal. Most firms operate with the traditional model
that management retains control and employees have few
rights. There may be reasons for this intransigence. One
argument against organizational democracy is that employees have a contractual rather than ownership relationship
with the organization. Legally (and possibly morally) they
have no right to assume citizenship rights or control over the
business. A second consideration is that employees might
emphasize their own interests to the detriment of other
stakeholders. In contrast, traditional organizations give management an explicit obligation to serve multiple stakeholders to ensure the organization’s survival and success.
Another concern is that workplace democracy might
dilute accountability. Although moderate levels of employee
involvement can improve decision-making quality and commitment, there is a real risk that no one will take responsibility for decisions when everyone has a say in them. In
addition, democracy often results in slower decision making, which could lead to a lethargic corporate response
to changes in the external environment. Finally, the democratic enterprise model presumes that employees want
to control their organizations, but some research suggests
that employees prefer a more moderate level of workplace
involvement. For this reason (and others noted above),
employee-owned companies often maintain a more traditional
hierarchical worker–management relationship.*****
* J.R. Foley and M. Polanyi, “Workplace Democracy: Why Bother?,” Economic and Industrial Democracy 27, no. 1 (2006): 173–91; P.A. Woods and P. Gronn,
“Nurturing Democracy,” Educational Management Administration & Leadership 37, no. 4 (2009): 430–51.
** R. Semler, The Seven-Day Weekend (London, UK: Century, 2003); G. de Jong and A. van Witteloostuijn, “Successful Corporate Democracy: Sustainable
Cooperation of Capital and Labor in the Dutch Breman Group,” Academy of Management Executive 18, no. 3 (2004): 54–66.
*** K. Cloke and J. Goldsmith, The End of Management and the Rise of Organizational Democracy (San Francisco, CA: Jossey-Bass, 2003); L. Gratton, The
Democratic Enterprise: Liberating Your Enterprise with Freedom, Flexibility, and Commitment (London, UK: FT Prentice-Hall, 2004).
**** P.E. Slater and W.G. Bennis, “Democracy Is Inevitable,” Harvard Business Review (1964): 51–59; D. Collins, “The Ethical Superiority and Inevitability of Participatory
Management as an Organizational System,” Organization Science 8, no. 5 (1997): 489–507; W.G. Weber, C. Unterrainer, and B.E. Schmid, “The Influence of
Organizational Democracy on Employees’ Socio-Moral Climate and Prosocial Behavioral Orientations,” Journal of Organizational Behavior 30, no. 8 (2009): 1127–49.
***** Collins, D. “The Ethical Superiority and Inevitability of Participatory Management as an Organizational System; R. Bussel, “Business without a Boss”: The
Columbia Conserve Company and Workers’ Control, 1917–1943,” The Business History Review 71, no. 3 (1997): 417–43; J.D. Russell, M. Dirsmith, and S. Samuel,
“Stained Steel: ESOPs, Meta-Power, and the Ironies of Corporate Democracy,” Symbolic Interaction 27, no. 3 (2004): 383–403.
Chapter Seven
responsibility for developing recommendations. However,
the decision maker is not bound to accept those recommendations. At the highest level of involvement, the entire
decision-making process is handed over to employees. They
identify the problem, discover alternative solutions, choose
the best alternative, and implement that choice. The original
decision maker serves only as a facilitator to guide the team’s
decision process and keep everyone on track.
For the past half century, organizational behaviour experts
have advised that employee involvement potentially
improves decision-making quality and commitment.90 To
begin with, it improves the identification of problems and
opportunities. Employees are, in many respects, the sensors
of the organization’s environment. When the organization’s
activities misalign with customer expectations, employees
Decision Making and Creativity
are usually the first to know. Employee involvement provides
a conduit for organizational leaders to be alerted to such
problems. Employee involvement can also potentially
improve the number and quality of solutions generated. In a
well-managed meeting, team members create synergy by
pooling their knowledge to form new alternatives. In other
words, several people working together can potentially generate
better solutions than the same people working alone.
A third benefit of employee involvement is that, under
specific conditions, it improves the evaluation of alternatives. Numerous studies on participative decision making,
task conflict, and team dynamics have found that involvement brings out more diverse perspectives, tests ideas, and
provides more valuable knowledge, all of which help the
decision maker to select the best alternative.91 A mathematical
theorem introduced in 1785 by the Marquis de Condorcet
states that the alternative selected by the team’s majority is
more likely to be correct than is the alternative selected by
any team member individually.92
Employee involvement has significantly improved environmental sustainability and productivity at Labatt Breweries of
Canada. In a typical year, 76 percent of the brewer’s employees submit suggestions for workplace improvements through
an online questionnaire. Last year, Labatt received 2,700 ideas, 1,603 of which were implemented. Some suggestions
have transformed operations. For example, Scott Baldwin, a brewer at Labatt’s brewery in London, Ontario, noticed that
huge amounts of water were being wasted in the brewing process as well as during beer tank cleaning. Baldwin worked
with engineers and others to conserve water in these production activities, saving the brewery 11.4 million litres of water
annually. “If it doesn’t start with Scott challenging it, then nothing moves,” says Alex Martel, general manager of Labatt’s
London brewery. “These people know their work areas the best.”*
* S. Coulter, “Cheers! Innovative Labatt Worker Saves Brewery 15M Litres of Water Annually,” London Free Press, June 5, 2018; D. Deveau, “Eight
Takeaways from Labatt’s Successful Employee Engagement Program,” National Post, June 21, 2018.
192 Part Three
Team Processes
Along with improving decision quality, involvement
tends to strengthen employee commitment to the decision.
Rather than viewing themselves as agents of someone else’s
decision, those who participate in a decision feel personally
responsible for its success. Involvement also has positive
effects on employee motivation, satisfaction, and turnover.
Furthermore, it increases skill variety, felt autonomy, and
task identity, all of which increase job enrichment and,
potentially, employee motivation. Participation is also a critical practice in organizational change because employees are
more motivated to implement the decision and less likely to
resist changes resulting from the decision.93
If employee involvement is so wonderful, why don’t leaders
leave all decisions to employees? The answer is that the optimal level of employee involvement depends on the situation.
The employee involvement model shown in Exhibit 7.7 lists
four contingencies: decision structure, source of decision
knowledge, decision commitment, and risk of conflict in the
decision process.94
• Decision structure. At the beginning of this chapter, we
learned that some decisions are programmed, whereas
others are nonprogrammed. Programmed decisions are less
likely to need employee involvement because the solutions
are already worked out from past incidents. In other words,
the benefits of employee involvement increase with the
novelty and complexity of the problem or opportunity.
• Source of decision knowledge. Subordinates should be
involved in some level of decision making when the leader
lacks sufficient knowledge and subordinates have additional
information to improve decision quality. In many cases,
employees are closer to customers and production activities,
so they often know where the company can save money,
improve product or service quality, and realize opportunities. This is particularly true for complex decisions where
employees are more likely to possess relevant information.
• Decision commitment. Participation tends to improve
employee commitment to the decision. If employees are
unlikely to accept a decision made without their involvement, some level of participation is usually necessary.
• Risk of conflict. Two types of conflict undermine the benefits of employee involvement. First, if employee goals and
norms conflict with the organization’s goals, only a low
level of employee involvement is advisable. Second, the
degree of involvement depends on whether employees will
agree with one another on the preferred solution. If conflict is likely to occur, high involvement (i.e., employees
make the decision alone) would be difficult to achieve.
Employee involvement is an important component of the
decision-making process. To make the best decisions, we
need to involve people who have the most valuable information and who will increase commitment to implement the
decision. Employee involvement is a formative stage of team
dynamics, so it carries many of the benefits and challenges
of working in teams. The next chapter provides a closer look
at team dynamics, including processes for making decisions
in teams.
Model of Employee Involvement in Decision Making
of Employee
• Decision structure
• Source of decision
• Decision commitment
• Risk of conf lict
Outcomes of
• Better problem
• More/better choices
• More likely to select the
best alternative
• Stronger commitment
to the decision
Chapter Seven
Decision Making and Creativity
Chapter Summary
Describe the elements of rational choice decision making.
Decision making is a conscious process of making choices among
one or more alternatives with the intention of moving toward some
desired state of affairs. Rational choice decision making identifies
the best choice based on the valence of numerous outcomes and the
probability that those outcomes will occur. It also follows the logical process of identifying problems and opportunities, choosing the
best decision style, developing alternative solutions, choosing the
best solution, implementing the selected alternative, and evaluating
decision outcomes.
Explain why people don’t apply rational choice decision
making when identifying problems/opportunities, evaluating/
choosing alternatives, and evaluating decision outcomes.
Solution-focused problem identification, decisive leadership, stakeholder framing, perceptual defence, and mental models affect our
ability to objectively identify problems and opportunities. We can
minimize these challenges by being aware of the human limitations
and discussing the situation with colleagues.
Evaluating and choosing alternatives is often challenging because
organizational goals are ambiguous or in conflict, human information
processing is incomplete and subjective, and people tend to satisfice
rather than maximize. Decision makers also short-circuit the evaluation process when faced with an opportunity rather than a problem.
People generally make better choices by systematically evaluating
alternatives. Scenario planning can improve future decisions without
the pressure and emotions that occur during real emergencies.
Confirmation bias and escalation of commitment make it difficult to accurately evaluate decision outcomes. Escalation is mainly
caused by the self-justification effect, self-enhancement effect, the
prospect theory effect, and sunk costs effect. These problems are
minimized by separating decision choosers from decision evaluators, establishing a stop-loss point to abandon the project, seeking
out factual information as well as feedback from others, and by
refocusing the decision maker’s mindset away from the past losses.
Discuss the roles of emotions and intuition in decision making.
Emotions shape our preferences for alternatives and the process we
follow to evaluate alternatives. We also listen in on our emotions
for guidance when making decisions. This latter activity relates to
intuition—the ability to know when a problem or opportunity exists
and to select the best course of action without conscious reasoning.
Intuition is both an emotional experience and a rapid nonconscious
analytic process that involves both pattern matching and action scripts.
Describe employee characteristics, workplace conditions, and
specific activities that support creativity.
Creativity is the development of original ideas that make a socially
recognized contribution. The four creativity stages are preparation,
incubation, illumination, and verification. Incubation assists divergent thinking, which involves reframing the problem in a unique
way and generating different approaches to the issue.
Four of the main features of creative people are intelligence,
persistence, expertise, and independent imagination. Creativity is
also strengthened for everyone when the work environment supports a learning orientation, the job has task significance and autonomy, the organization provides a reasonable level of job security,
and leaders provide an appealing vision of the future with the right
degrees of time pressure and resources. Four types of activities
that encourage creativity are redefining the problem, associative
play, cross-pollination, and design thinking. Design thinking is a
human-centred, solution-focused creative process that applies both
intuition and analytical thinking to clarify problems and generate
innovative solutions. Four rules guide this process: human rule,
ambiguity rule, re-design rule, and tangible rule.
Describe the benefits of employee involvement and identify
four contingencies that affect the optimal level of employee
Employee involvement refers to situations in which employees
participate in and influence decisions about their jobs, work
units, or organization. The level of participation may range from
an employee providing specific information to the decision maker
without knowing the problem or issue, to complete involvement
in all phases of the decision process. Employee involvement may
lead to better decision quality and commitment, but several contingencies need to be considered, including the decision structure,
source of decision knowledge, decision commitment, and risk of
Key Terms
anchoring and adjustment heuristic
availability heuristic
bounded rationality
confirmation bias
decision making
design thinking
divergent thinking
escalation of commitment
implicit favourite
learning orientation
194 Part Three
Team Processes
mental models
prospect theory effect
rational choice decision making
representativeness heuristic
scenario planning
Critical Thinking Questions
1. A management consultant is hired by a manufacturing
firm to determine the best site for its next production
facility. The consultant has had several meetings with
the company’s senior executives regarding the factors to
consider when making the recommendation. Discuss the
decision-making problems that might prevent the consultant from choosing the best site location.
2. You have been asked to personally recommend a new
travel agency to handle all airfare, accommodation, and
related travel needs for your organization of 500 staff.
One of your colleagues, who is responsible for the company’s economic planning, suggests that the best travel
agent could be selected mathematically by inputting the
relevant factors for each agency and the weight (importance) of each factor. What decision-making approach is
your colleague recommending? Is this recommendation a
good idea in this situation? Why or why not?
3. Intuition is both an emotional experience and an unconscious analytic process. One problem, however, is that
not all emotions signalling that there is a problem or
opportunity represent intuition. Explain how we would
know whether our “gut feelings” are intuition, and if not
intuition, suggest what might be causing them.
4. A developer received financial backing for a new business financial centre along a derelict section of the
waterfront, a few miles from the current downtown area
of a large European city. The idea was to build several
high-rise structures, attract large tenants to those sites,
and have the city extend transportation systems out to
the new centre. Over the next decade, the developer
believed that others would build in the area, thereby
attracting the regional or national offices of many financial institutions. Interest from potential tenants was
much lower than initially predicted and the city did not
build transportation systems as quickly as expected.
Still, the builder proceeded with the original plans. Only
after financial support was curtailed did the developer
reconsider the project. Using your knowledge of escalation
of commitment, discuss three possible reasons why the
developer was motivated to continue with the project.
5. Ancient Book Company has a problem with new book
projects. Even when others are aware that a book is far
behind schedule and may engender little public interest,
acquisitions editors are reluctant to terminate contracts
with authors whom they have signed. The result is that
editors invest more time with these projects than on more
fruitful projects. As a form of escalation of commitment,
describe two methods that Ancient Book Company can
use to minimize this problem.
6. A recent graduate is offered a job by an employer she
admires even before she could start the job search. The
student thinks it is an opportunity and jumps on it. Do
you think there is an effect of emotions in her decision
7. Think of a time when you experienced the creative process. Maybe you woke up with a brilliant (but sketchy
and incomplete) idea, or you solved a baffling problem
while doing something else. Describe this incident to
your class and explain how the experience followed the
creative process.
8. Two characteristics of creative people are that they have
relevant experience and are persistent in their quest.
Does this mean that people with the most experience and
the highest need for achievement are the most creative?
Explain your answer.
9. Employee involvement applies just as well to the classroom as to the office or factory floor. Explain how student involvement in classroom decisions typically made
by the instructor alone might improve decision quality.
What potential problems may occur in this process?
Chapter Seven
Decision Making and Creativity
Case Study:
by Steven L. McShane, University of Newcastle (Australia)
More than 3 million dogs enter animal shelters each year in
the United States, and almost one-third of these have been
surrendered by their owners. Until recently, animal shelter
employees assumed that the owners didn’t want their pets
anymore, so they focused their resources on ways to get the
surrendered dogs re-adopted with new owners.
Now, animal shelters recognize that they were focused on
the wrong problem to some extent. Most owners of surrendered dogs love their pets but believe they are unable to keep
them due to financial or family difficulties. “Owner surrenders are not a people problem,” explains Lori Weise, founder
of Downtown Dog Rescue in Los Angeles. “By and large,
they are a poverty problem. These families love their dogs as
much as we do, but they are also exceptionally poor.” Even
when owners surrender their dog due to the pet’s behaviour,
animal shelter staff have learned that the problem is often the
owners’ lack of basic training to improve their pet’s behaviour.
These discoveries have been a wake-up call for animal
shelters. Along with finding new homes for surrendered
dogs, shelters now also focus on strategies that enable owners to keep their pets. Downtown Dog Rescue in Los Angeles
is a pioneer in applying diverse solutions to minimize the
number of dogs surrendered each year to animal shelters.
Through donations, the organization provides free dog vaccinations, spay/neutering, medical assistance, pet licences, and
other forms of support to help low-income people keep their
pets rather than surrender them to shelters.
Until recently, Animal Care Centers (ACC) of New York
City also focused solely on getting surrendered dogs to new
owners. The municipal agency receives more than 30,000
pets annually at its shelters in five New York City boroughs.
Front desk staff members were aware of common themes
why owners were surrendering their pets: they couldn’t
afford veterinary care; they had fallen on hard times and
weren’t allowed to keep dogs at their new temporary accommodation; the dog had behaviour problems that the owner
didn’t know how to correct.
Unfortunately, ACC staff receiving the surrendered dogs
have many other duties (returning pets to owners, tracing
licence tags, etc.). All they could do in most instances was ask
the owners the required questions to complete the paperwork.
“They were overwhelmed and didn’t have time to sit down
with clients and have those really in-depth conversations to
see if there was anything we could do to help them keep their
pet,” recalls ACC admissions supervisor Aleah Simpson. It
was also an awkward situation because the owners answered
the questions and surrendered their pet in ACC’s crowded
front lobby where many dog-loving clients were listening.
Inspired by the work of Downtown Dog Rescue in Los
Angeles, ACC now takes a dramatically different approach to dog
surrenders. Instead of answering a few questions asked by busy
front desk staff, owners who intend to surrender their dogs are
now greeted by trained ACC admission counsellors with impeccable people skills. In a private office, these counsellors listen to
the owner’s story about why they want or need to surrender their
dog. These counsellors are trained by licensed social workers to
maintain a nonjudgmental attitude toward the owners and to handle difficult situations. “Once that person (the pet owner) doesn’t
feel like they’re going to be judged in that moment, they might
open up and tell you the real situation,” says Simpson.
Based on the information from these conversations, ACC
counsellors direct some owners to support groups that can provide assistance, such as financial support or temporary lodging
for the dog. In other situations, the owners are invited to attend
brief training programs where they receive instruction on how
to improve the pet’s behaviour. The conversations also help
counsellors determine which pets are better off with new owners. As new situations arise, ACC staff have found increasingly
innovative and customized solutions to enable owners to keep
their pet. “Even two years ago, I would think there wouldn’t
be options for so many of these pet owners and their animals,”
says Jenny Coffey of the Mayor’s Alliance for NYC’s Animals.
ACC predicted that over the first 18 months of the program, 150 owners would keep their pets as a result of the
counselling program. Instead, this initiative has reduced the
intake by more than 90 pets per month. Through New York
Community Trust funding, ACC introduced free veterinary
and humane care to pets of owners in low-income areas of
New York City. Pet surrenders have dropped by 50 percent,
on average, in the areas that received this funding.
“It’s almost as if a few years back a massive light bulb
went off in the animal welfare community,” says Matthew
Bershadker, CEO of the American Society for the Prevention
of Cruelty to Animals (ASPCA), about the industry’s
reframed mandate. “We stopped thinking about how to get
animals out of shelters and we started thinking about how to
keep animals from coming into shelters.”
Discussion Questions
1. What stage of decision making is mainly discussed in this
case about dog surrenders? To what extent and in what
ways did the change in that stage of decision making affect
later stages of decision making about dog surrenders?
2. How has creativity played a role in the events described
in this case study?
196 Part Three
Team Processes
Class Exercise:
Purpose This exercise is designed to help you understand
the contingencies of employee involvement.
Instructions (Small or Large Class) Four scenarios are
presented in this exercise. Assume you are the manager or
person in charge. For each scenario, identify the preferred
level of employee involvement from one of the five levels
described below. For each scenario, identify and justify what
factors led you to choose this level of employee involvement
rather than the others. Also, be prepared to discuss what
problems might occur with less or more involvement in this
case (where possible).
1. Decide alone. Use your personal knowledge and insight
to complete the entire decision process without conferring with anyone else.
2. Receive information from individuals. Ask specific individuals for information. They do not make recommendations and might not even know what the problem is about.
3. Consult with individuals. Describe the problem to selected
individuals and seek both their information and recommendations. The final decision is made by you, and you
may or may not take the advice from others into account.
4. Consult with the team. You bring together a team of people (all department staff or a representation of them if the
department is large), who are told about the problem and
provide their ideas and recommendations. You make the
final decision, which may or may not reflect the team’s
5. Facilitate the team’s decision. The entire decision-making process is handed over to a team or committee of
subordinates. You serve only as a facilitator to guide the
decision process and keep everyone on track. The team
identifies the problem, discovers alternative solutions,
chooses the best alternative, and implements their choice.
For each incident, students or teams should be prepared to
answer the following questions:
1. What factors led you to choose this level of employee
involvement rather than the others?
2. What problems might occur if less or more involvement
occurred in this case (where possible)?
As head of the transmission/distribution group (TD group)
in the city’s water agency (a government corporation), you
have been asked to reduce costs over the next year by a
minimum of 3 percent without undermining service. Your
department employs about 300 people who are responsible
for constructing and maintaining water lines throughout the
city. Although you have an engineering background, the
work is complex and involves several professions and trades.
Even the TD group’s first line supervisors (one or two levels
below you in the hierarchy) are not fully knowledgeable of
all aspects of the business.
You believe that most employees support or at least accept
the city’s recent mandate to reduce costs (called the “productivity dividend initiative”). The city leaders have stated that
this initiative will not result in any layoffs this year. However,
the labour union representing most nonmanagement staff in
the water agency (including most of your employees) is concerned that the productivity dividend initiative will reduce
employment numbers over time and increase employee
workloads. Although the TD group is a separate department
within the city water agency, it affects most other work units
in the agency. It is possible, for example, that ideas that
reduce costs in the TD group might increase costs elsewhere.
The TD group employees may be unaware of or care about
these repercussions because there is limited interaction with
or social bonding with employees in the other departments.
You are the head of research and development (R&D) for a
major beer company. While working on a new beer product,
one of the scientists in your unit seems to have tentatively
identified a new chemical compound that has few calories
but tastes closer to sugar than current sugar substitutes. The
company has no foreseeable need for this product, but it
could be patented and licensed to manufacturers in the food
The sugar-substitute discovery is in its preliminary stages
and would require considerable time and resources before
it would be commercially viable. This means that it would
necessarily take some resources away from other projects in
the lab. The sugar substitute project is beyond your technical
expertise, but some of the R&D lab researchers are familiar
with that field of chemistry. It is difficult to determine the
amount of research required to further identify and perfect
the sugar substitute. You do not know how much demand
is expected for this product. Your department has a decision process for funding projects that are behind schedule.
However, there are no rules or precedents about funding projects that would be licensed but not used by the organization.
The company’s R&D budget is limited, and other scientists in your work group have recently complained that they
Chapter Seven
require more resources and financial support to get their
projects completed. Some of these R&D projects hold promise for future beer sales. You believe that most researchers in
the R&D unit are committed to ensuring that the company’s
interests are achieved.
You are the captain of a 72-metre Coast Guard cutter with a
crew of 16, including officers. Your mission is general at-sea
search and rescue. Today at 2:00 a.m., while en route to your
home port after a routine 28-day patrol, you received word
from the nearest Coast Guard station that a small plane had
crashed 100 kilometres offshore. You obtained all the available
information concerning the location of the crash, informed your
crew of the mission, and set a new course at maximum speed
for the scene to commence a search for survivors and wreckage.
You have now been searching for 20 hours. Your search
operation has been impaired by increasingly rough seas,
and there is evidence of a severe storm building. The atmospherics associated with the deteriorating weather have made
communications with the Coast Guard station impossible.
A decision must be made shortly about whether to abandon
the search and place your vessel on a course that would ride
out the storm (thereby protecting the vessel and your crew,
but relegating any possible survivors to almost certain death
from exposure) or to continue a potentially futile search and
the risks it would entail.
Before losing communications, you received an update
weather advisory concerning the severity and duration of
the storm. Although your crew members are extremely conscientious about their responsibility, you believe that they
would be divided on the decision of leaving or staying.
The Industry Initiatives Agency is a group of 120 professionals responsible for marketing the province as a good place for
companies to operate their business or open new operations.
Decision Making and Creativity
Although you report to the head of the province’s ministry
of employment and commerce, your agency is semi-autonomous in its policies and practices from the parent department. One of your highest priorities is to recruit and retain
young, well-educated, high-potential employees for this
growing agency. During a recent recruiting drive at universities and colleges, some potential applicants candidly stated
that the provincial government seems out of touch with the
younger generation, particularly in their use of technology.
A few observed that your agency’s website doesn’t provide
much recruitment information, and they couldn’t find the
agency’s Facebook or Twitter sites.
These comments led to you think about having a social media
policy in the Industry Initiatives Agency, and particularly
whether or to what degree the agency should allow or possibly even encourage its staff to have work-related Facebook
sites, personal blogs, and Twitter sites, and to participate in
those sites during work hours. You personally know very
little about emerging social media, although many of your
direct reports (functional managers and team leaders) have
varying degrees of knowledge about them. A few have their
own personal Facebook sites and one manager has her own
travel blog. Some direct reports are strongly opposed to
social media in the workplace, whereas others are very supportive. However, you believe that all of their views are taken
in the agency’s best interests.
This social media policy decision would be within your
mandate; unlike most governments, neither the provincial
government nor the employment and commerce ministry has such a policy or restrictions on any policy that is
designed by your agency. However, a few specific government departments prohibit Facebook and texting activity
during work, and, due to concerns about breaches of confidentiality and employer reputation, do not allow employees
to mention work-related matters in any social media. Your
decision is to develop a policy specifying whether and,
if so, to what degree, agency staff should be allowed and
encouraged to engage in social network site activity during
work hours.
Class Exercise:
Purpose This exercise is designed to help students understand the dynamics of creativity and divergent thinking in
decision making.
Instructions (Large or small class) The instructor describes
the problem, and students are asked to figure out the solution,
working alone. When enough time has passed, the instructor
may then ask specific students who think they have the solution
to describe (or show using projection technology) their answer.
The instructor will review the solutions and discuss the implications of this exercise. In particular, be prepared to discuss
what you needed to solve these puzzles and what may have
prevented you from solving them more quickly.
1. Double-circle problem. Draw two circles, one inside the
other, with a single line and with neither circle touching
198 Part Three
Team Processes
the other (as shown below). In other words, you must
draw both of these circles without lifting your pen (or
other writing instrument).
3. Nine-dot problem revisited. Referring to the nine-dot
exhibit above, describe how, without lifting your pencil,
you could pass a pencil line through all dots with three or
fewer straight lines.
4. Word search. In the following line of letters, cross out
five letters so that the remaining letters, without altering
their sequence, spell a familiar English word.
2. Nine-dot problem. Below are nine dots. Without lifting
your pencil, draw no more than four straight lines that
pass through all nine dots.
5. Burning ropes. You have two pieces of rope of unequal
lengths and a box of matches. In spite of their different
lengths, each piece of rope takes one hour to burn;
however, parts of each rope burn at unequal speeds.
For example, the first half of one piece might burn in
10 minutes. Use these materials to accurately determine
when 45 minutes has elapsed.
Self-Assessments for Chapter 7
What is your preferred
decision-making style?
Effective decision making is a critical part of most jobs, particularly in professional and executive
positions. But people have different decision-making styles, including how much they rely on facts and
logical analysis or emotional responses and gut instinct. This tool assesses your preference for logical
or intuitive decision making.
How well do you engage in
divergent thinking?
A key feature of creativity is divergent thinking—reframing the problem in a unique way and generating different approaches to the issue. One way to test divergent thinking is by presenting questions
or problems in which the answer requires a different approach or perspective from the usual frame of
mind. This self-assessment presents a dozen of these questions.
Do you have a creative
Everyone is creative to some extent, but some people have personality traits and personal values that
give them higher creative potential. This self-assessment helps you to discover the extent to which you
have a creative personality.
Team Dynamics
After reading this chapter, you should be able to:
LO1 Define teams and informal groups, and explain why employees join informal groups.
LO2 Discuss the benefits and limitations of teams.
LO3 Outline the team effectiveness model and discuss how task characteristics, team
size, and team composition influence team effectiveness.
LO4 Discuss how the six team processes—team development, norms, roles, cohesion,
trust, and mental models—influence team effectiveness.
LO5 Discuss the characteristics and factors required for the success of self-directed
teams and remote teams.
LO6 Identify four constraints on team decision making and discuss ways to improve
decision making and creativity in teams.
Each year, teams of undergraduate students
compete in the the Bank of Canada Governor’s
Challenge. Through a video link to Bank of
Canada judges, each team presents its analysis of
current macroeconomic and financial conditions
and recommends monetary policy from that analysis. The judges evaluate not only the quality of
each team’s economic and financial analysis; they
also rate how well the members of each team
work together. The team’s collaborative performance is assessed both in the presentation and
Teamwork has become an integral part of working in the
the subsequent question-and-answer session.
finance industry in Canada and elsewhere.
Teamwork is an important factor in the Governor’s
Challenge because teams have become essential
in the finance industry. Whether managing investment funds, providing financial advice to clients, or conducting macroeconomic analysis for central bank
policy, teams usually perform better than individual stars working alone.
Executives at RBC Capital Markets identify teamwork as a key reason for their success as Canada’s
top-ranked investment bank. The company carefully selects job applicants who are “understated and
team-oriented.” Big-ego Masters of the Universe financiers are not welcome, warns a senior executive.
Teamwork is vital because no individual has sufficient expertise to provide the investment bank’s complex
services. RBC Capital Markets chief executive Derek Neldner gives this example: “If you are going to offer
200 Part Three
Team Processes
serious coverage to a health care client, you need an analyst who can talk authoritatively on medical
devices, an expert on pharmaceuticals, one on biotech and so on.”
The shift from individual stars to high-performing teams is very evident at Merrill Lynch Wealth
Management. A decade ago, most of the company’s 15,000 financial advisors worked alone with their
clients. Today, 77 percent of Merrill Lynch’s advisors work in teams. These teams offer greater expertise
across a broader range of asset classes (stocks, bonds, derivatives, cash management, etc.) as well as
expertise across regions of the world.
“It’s exceedingly rare that a single individual could deliver everything a client needs today,” says Merrill
Lynch Wealth Management president Andy Sieg. “When you look at what clients need—comprehensive
advice across their financial lives—it very quickly becomes obvious that the only way to deliver that is
through a team.”1
Investment analysts, financial advisors, and others in the
finance industry increasingly work in teams rather than alone.
In fact, this trend toward teamwork is occurring in many industries. One recent study reports that collaborating with others—
whether face-to-face or remotely through technology—now
takes up to 80 percent of an employee’s time. Another study
found that employees are involved in almost twice as many
teams than five years ago. By comparison, three decades ago
only 20 percent of executives said they worked in teams at all!2
The importance of teamwork extends to scientific research.
A study of almost 20 million research publications reported
that the percentage of journal articles written by teams rather
than individuals has increased substantially over the past five
decades. Team-based articles also had a much higher number
of subsequent citations, suggesting that journal articles written by teams are superior to articles written by individuals.3
Why are teams becoming so important, and how can
organizations improve team effectiveness? We find the
answers to these and other questions in this chapter on team
dynamics. This chapter begins by defining teams, examining
the reasons why organizations rely on teams, and explaining why people join informal groups in organizational settings. A large segment of this chapter examines a model of
team effectiveness, which includes team and organizational
environment, team design, and team processes (team development, norms, roles, cohesion, trust, and mental models).
We then turn our attention to two specific types of teams:
self-directed teams and remote teams. The final section of
this chapter looks at the challenges and strategies for making
better decisions in teams.
Teams and Informal Groups
Teams are groups of two or more people who interact with and
influence each other, are mutually accountable for achieving
common goals associated with organizational objectives, and
perceive themselves as a
teams Groups of two or more
social entity within an orgapeople who interact and influ4
nization. This definition
ence each other, are mutually
has a few important comaccountable for achieving
common goals associated
ponents worth repeating.
with organizational objectives,
First, all teams exist to fulfil
and perceive themselves
some purpose, such as proas a social entity within an
viding wealth management
services, repairing electric
power lines, designing a
new educational program, or making an important executive decision. Second, team members are held together by
their interdependence and need for collaboration to achieve
common goals. All teams require some form of communication so that members can coordinate, share information,
and develop a common mindset regarding their purpose
and objectives. Third, team members influence each other,
although some members may be more influential than others regarding the team’s goals and activities. Finally, a team
exists when its members perceive themselves to be a team.
They feel connected to one another through a common interest or purpose.
There are many types of teams in organizations, and
each type can be distinguished by three characteristics: team
permanence, skill diversity, and authority dispersion (see
Exhibit 8.1).5 Team permanence refers to how long that type
of team usually exists. Accounting, marketing, and other
departments are usually long-lasting structures, so these
teams have high permanence. In contrast, task forces and
project teams usually have low permanence because most are
formed temporarily to solve a problem, realize an opportunity, or design a product or service.
A second distinguishing characteristic is the team’s skill
diversity. A team has high skill diversity when its members
possess different skills and knowledge, whereas low diversity
exists when team members have similar abilities and, therefore, are interchangeable. Most functional departments have
Chapter Eight
Team Dynamics
Team Permanence, Skill Diversity, and Authority Dispersion for Selected Team Types
Team type
Team characteristics
Departmental teams
Teams that consist of employees who have similar or
complementary skills and are located in the same unit of a
functional structure; usually minimal task interdependence
because each person works with clients or with employees
in other departments.
Team permanence: High—departments continue
Skill diversity: Low to medium—departments are often organized around common skills (e.g., accounting staff located in
the accounting department).
Authority dispersion: Low—departmental power is usually
concentrated in the departmental manager.
Self-directed teams
Teams whose members are organized around work
processes that complete an entire piece of work requiring
several interdependent tasks and have substantial autonomy
over the execution of those tasks (i.e., they usually control
inputs, flow, and outputs with little or no supervision).
Team permanence: High—teams are usually assigned indefinitely to a specific cluster of production or service activities.
Skill diversity: Medium to high—members typically perform
different tasks requiring diverse skill sets, but cross-training
can somewhat reduce skill diversity.
Authority dispersion: High—team members share power,
usually with limited hierarchical authority.
Task forces/project teams
Cross-functional teams whose members are usually drawn
from several disciplines to solve a specific problem, realize
an opportunity, or design a product or service.
Team permanence: Low—teams typically disband on completion of a specific project.
Skill diversity: Medium to high—members are typically
drawn from several functional specializations associated
with the complexity of the problem or opportunity.
Authority dispersion: Medium—teams often have someone
with formal authority (project leader), but members also
have moderate power due to their expertise and functional
low skill diversity because they organize employees around
their common skill sets (e.g., people with accounting expertise are located in the accounting department). In contrast,
financial advisory team members have diverse expertise
in different asset classes (stocks, bonds, etc.) or economic
Authority dispersion, the third distinguishing characteristic of teams, refers to the degree that decision-making
responsibility is distributed throughout the team (high dispersion) or is vested in one or a few members of the team
(low dispersion). Departmental teams tend to have low
authority dispersion because power is somewhat concentrated in a formal manager. Self-directed teams usually have
high authority dispersion because the entire team makes key
decisions and hierarchical authority is limited.
This chapter mainly focuses on formal teams, but employees also belong to informal groups. All teams are groups,
but many groups do not satisfy our definition of teams.
Groups include people assembled together, whether or not
they have any interdependence or organizational objective.
The friends you meet for lunch are an informal group, but
they wouldn’t be called a team because they have little or no
interdependence (each person could just as easily eat lunch
alone) and no organizationally mandated purpose. Instead,
they exist primarily for the benefit of their members.
Although the terms are used interchangeably, teams has
largely replaced groups in the language of business when
referring to employees who work together to complete organizational tasks.6
Why do informal groups exist? One reason is that human
beings are social animals. Our drive to bond is hardwired
through evolutionary development, creating a need to belong
to informal groups.7 This is evident by the fact that people
invest considerable time and effort forming and maintaining
social relationships without any special circumstances or
ulterior motives. A second reason why people join informal
groups is provided by social identity theory, which states that
individuals define themselves by their group affiliations (see
Chapter 3). Thus, we join groups—particularly those that are
viewed favourably by others and have values similar to our
own—because they shape and reinforce our self-concept.8
202 Part Three
Team Processes
A third reason why informal groups exist is that they
accomplish personal objectives that cannot be achieved by
individuals working alone. For example, employees will
sometimes congregate to support or oppose organizational
changes because this collective effort has more power than
individuals who try to bring about change alone. These informal groups, called coalitions, are discussed in Chapter 10. A
fourth explanation for informal groups is that we are comforted by the mere presence of other people and are therefore
motivated to be near them in stressful situations. When in
danger, people congregate near each other even though doing
so serves no protective purpose. Similarly, employees tend to
mingle more often after hearing rumours that the company
might be acquired by a competitor. As Chapter 4 explained,
this social support minimizes stress by providing emotional
and/or informational support to buffer the stress experience.9
Informal Groups and Organizational
Informal groups are not created to serve corporate objectives,
yet they have a profound influence on the organization and its
employees. Informal groups potentially minimize employee
stress because, as mentioned, group members provide emotional
and informational social support. This stress-reducing capability
of informal groups improves employee well-being, which potentially increases organizational effectiveness. Informal groups
are also the backbone of social networks, which are important
sources of trust building, information sharing, power, influence, and employee well-besocial networks Social
ing in the workplace.10
structures of individuals
Chapter 10 explains how
or social units that are
social networks are a source
connected to each other
of influence in organizathrough one or more forms of
tional settings. Employees
with strong informal networks tend to have more power and influence because they
receive better information and preferential treatment from others
and their talent is more visible to key decision makers.
Benefits and Limitations of Teams
Why are teams important at RBC Capital Markets, Merrill
Lynch Wealth Management, and so many other organizations
around the world? The answer to this question has a long history.11 Early research on British coal mining in the 1940s,
the Japanese economic miracle of the 1970s, and a huge
number of investigations since then have revealed that under
the right conditions, teams make better decisions, develop
better products and services, and create a more motivated
workforce than do employees working alone.12 Similarly,
team members can quickly share information and coordinate
tasks, whereas these processes are slower and prone to more
errors in traditional departments led by supervisors. Teams
typically provide superior customer service because they
offer clients a greater breadth of knowledge and expertise
than do individual “stars” working alone.
Another benefit of teams is that, in many situations, their
members are more motivated than when working alone.13
Teams generate three motivating forces. First, employees
have a drive to bond and are motivated to fulfil the goals of
groups to which they belong. This felt obligation is particularly strong when the employee’s social identity is connected
to the team. Second, employees have high accountability
to fellow team members, who monitor performance more
closely than a traditional supervisor. This accountability is
particularly strong when the team’s performance depends on
the worst performer, such as on an assembly line. Third, each
team member creates a moving performance standard for the
others. Employees are also motivated to work harder because
of apprehension that their performance will be compared to
the performance of others. When a few employees complete
tasks faster, other team members recognize that they also
could work faster, and that they should work faster.
Teams are potentially very productive, but they are not always as
effective as individuals working alone.14 The main problem
is that teams have additional costs called process losses—
resources (including time and energy) expended toward team
development and maintenance rather than directly toward task
performance.15 Team members need time and effort to develop
mutual understanding of
their goals, determine the
process losses Resources
best strategy for accom(including time and energy)
expended toward team develplishing those goals, negoopment and maintenance
tiate their specific roles,
rather than the task.
agree on informal rules of
conduct, and resolve their
disagreements. An employee working alone on a project does
not have these internal misunderstandings, divergent viewpoints, disagreements, or coordination problems (at least, not
nearly as much as with other people). Teams may be necessary when the work is so complex that it requires knowledge
and skills from several people. But when the work can be
performed by one person, process losses can make a team
much less effective than an individual working alone.
Process losses tend to increase with the team’s diversity
and size.16 Diverse teams offer many benefits, which we
describe later in this chapter. However, the wider range of
beliefs and values slows the team’s development toward an
optimally productive work unit. Members of diverse teams
Chapter Eight
Team Dynamics
©Guerilla/Alamy Stock Photo
Verafin Inc. thrives on teamwork. The St. John’s, Newfoundland, company’s 150 employees build and maintain the world’s
leading cloud-based platform for financial crime management. This is complex and often fast-paced work, which requires
dedicated multiskilled project teams, along with impromptu scrum teams that form quickly when urgent problems arise.
“We have a great team, we have a singular focus, so it makes every day unique, challenging, but exciting and fun,” beams
Verafin product specialist Corey Lynch. Jacqueline Rideout, Verafin’s director of customer education, is amazed by the
incredible power of teamwork. “When a team of people are presented with a problem and all of those creative brilliant
minds come together and solve that problem it is inspirational and it makes going to work really, really fun.”*
* Verafin Recruitment Video 2017, YouTube (St. John’s, Nfld: Verafin, December 15, 2017), https://www.youtube.com/watch?v=ubDJB84DbfQ. Some information is also derived from Verafin’s website, verafin.com.
spend more time resolving conflicts about the team’s purpose, team roles, coordination routines, and so forth. Larger
teams have higher process losses because understanding,
agreeing with, and synchronizing work with many people
is more difficult than with few people. Larger teams also
require more time for each member to be meaningfully
involved in the team’s decisions.
Process losses are also amplified, at least temporarily, when
adding new members to an existing team. The new team members consume time and effort figuring out how to work well
with other team members. Performance also suffers among
existing team members while their attention is diverted from
task performance to accommodating and integrating the newcomer. The software industry even has a name for the problems of adding people to a
Brooks’s law The principle
team: Brooks’s law says
that adding more people to
that adding more people to
a late software project only
a late software project only
makes it later.
makes it later!17
Social Loafing
The process losses just described mainly refer to coordination challenges, but teams also suffer from motivational
process losses. The bestknown motivational prosocial loafing The problem
cess loss is social loafing,
that occurs when people
which occurs when peoexert less effort (and usually
perform at a lower level) when
ple exert less effort (and
working in teams than when
usually perform at a lower
working alone.
level) in teams than when
working alone.18
Social loafing is more pervasive under several conditions.19 It is more likely to occur when individual performance
is hidden or difficult to distinguish from the performance of
other team members. Individual performance is less visible
in larger rather than smaller teams. It is also hidden when the
team produces a single output (e.g., solving a client’s problem)
rather than separate outputs for each team member (e.g., each
member reviews several accounting reports per day). Second,
204 Part Three
Team Processes
social loafing is more common when the work is boring or the
team’s overall task has low task significance (see Chapter 6).
Third, social loafing is more prevalent among team members
with low conscientiousness and low agreeableness personality traits, as well as low collectivist values.
Fourth, social loafing is more widespread when employees lack motivation to help the team achieve its goals. This
lack of motivation occurs when individual members have
low social identity with the team and the team has low
cohesion. Lack of motivation also occurs when employees
believe other team members aren’t pulling their weight. In
other words, social loafers provide only as much effort as
they believe others will provide, which is their way of maintaining fairness in work allocation. Employees also exert
less effort when they believe they have little control over the
team’s success, such as when the team is large (their contribution has minimal effect on the team’s performance) and
when the team is dependent on other members with known
performance problems.
By understanding the causes of social loafing, we can
identify ways to minimize this problem.20 Some of the strategies
listed below reduce social loafing by making each member’s
performance more visible. Others increase each member’s
motivation to perform their tasks and mindfully minimize
social loafing within the group.
• Form smaller teams—Splitting the team into several
smaller groups reduces social loafing because each person’s performance becomes more noticeable and important for team performance. “When the group is smaller,
there’s nowhere to hide,” explains Strategic Investments &
Holdings principal David Zebro. “You have to pull your
weight.”21 Individuals also tend to develop stronger commitment to and identify with smaller than larger teams.
• Measure individual performance—Social loafing is
minimized when each member’s contribution is measured. This is possible when each member can perform
parallel tasks, such as serving different customers. But
measuring individual performance is difficult to implement when the team produces a single output, such as
solving one client’s problem.
• Specialize tasks—It is easier to measure individual
performance when each team member performs a different work activity. For example, rather than pooling their
effort for all incoming customer inquiries, each customer
service representative might be assigned a particular type
of client.
• Increase job enrichment—Social loafing is minimized
when each team member’s job is highly motivating, such
as when the work has high task significance or is sufficiently varied and challenging rather than boring.
• Increase mindfulness of team obligations—Social loafing
can be minimized by alerting team members to this problem and asking them to declare their commitment to the
team’s performance objectives. This relates to the discussion in Chapter 2 on increasing employee awareness of
values and ethics.
• Select motivated, team-oriented employees—Employees
are less susceptible to social loafing when they identify
with the team, have moderate or higher conscientiousness and agreeableness personality traits, and have a
fairly high collectivist value orientation. Social loafing
is also minimized by selecting team members who are
self-motivated, because these people perform their tasks
well even when their personal work output is difficult
to measure. One recent study reported that teams whose
members played team sports had lower levels of social
loafing. Team sport members are possibly more collectivist, identify more easily with their teams, are more
self-motivated, or have developed greater mindfulness of
their obligations to the team.
Overall, teams can be very powerful forces for competitive advantage, or they can be much more trouble than they
are worth. To understand when teams are better than individuals working alone, we need to more closely examine
the conditions that make teams effective or ineffective. The
next few sections of this chapter discuss the model of team
A Model of Team Effectiveness
Why are some teams effective while others fail? To answer
this question, we first need to clarify the meaning of team
effectiveness. A team is effective when it benefits the organization and its members and survives long enough to accomplish its mandate.22 Team effectiveness has three key features.
First, teams exist to serve some organizational purpose, so
effectiveness is partly measured by the achievement of that
objective. Second, a team’s effectiveness relies on the satisfaction and well-being of its members. People join groups to
fulfil their personal needs, so effectiveness is partly measured
Are you a team player? You can discover your preferences about working in teams by locating this
self-assessment in Connect.
Chapter Eight
by this need fulfilment. Third, team effectiveness includes the
ability and motivation of team members to remain together
long enough to accomplish the assigned goals. Even teams
that exist for only a few days could fall apart, literally (people
refuse to join or stay with the team) or cognitively (members
become emotionally disengaged from the team).
Over the past half century, researchers have developed
several models to identify the features, conditions, and processes that make some teams more effective than others.23
Exhibit 8.2 integrates the main components of these team
effectiveness models. This exhibit is a meta-model because
each component (team norms, team cohesion, etc.) includes
its own set of theories and models to explain how that component operates. Over the next two sections, we discuss theories for each part of this model.
The organization and team environment refers to the context surrounding the team, such as its physical workspace
and organizational leadership. Team design refers to variables that, for the most part, are assigned to the team when it
is created and altered throughout its existence. The number
of people assigned to the team (team size) and the personal
The organizational and team environment represents all
conditions surrounding the team that influence its effectiveness.27 Teams thrive where the physical workspace encourages collaborative interaction, information systems support
• Task characteristics
• Team size
• Team composition
and team
Organizational leadership
Organizational structure
Physical space
• Accomplish tasks
• Satisfy member needs
• Maintain team survival
attributes these members bring to the team (team composition) are elements of team design, for example.24
Team processes are described in various and sometimes
conflicting ways in the literature.25 In this book, team processes are the cognitive and emotional dynamics of the team
that continually change with its development. These processes centre around the team’s development and the associated variables of team norms, roles, cohesion, trust, and
shared/complementary mental models. Team process variables are sometimes labelled as “emergent states” of the
team, but one respected expert has warned that we should
focus on team processes rather than the fleeting and continuously evolving team states created by those processes.26
Team Effectiveness Model
Team Dynamics
Team development
Team norms
Team roles
Team cohesion
Team trust
Team mental models
206 Part Three
Team Processes
Global Connections 8.1
Many years ago, Toyota Motor Company discovered that it
can speed up new car design by forming a cross-functional
team consisting of people from several engineering and
related departments, and having those team members
meet regularly in an obeya—Japanese for “large room.”
Companies throughout Europe have recently introduced obeya rooms to improve team performance on
complex problems through face-to-face interaction.
The obeya room at French automaker PSA Peugeot
Citroën is a command central. The walls are plastered
with graphs and notes so team members can visualize
progress and document key issues. The obeya room
at Nike’s European Distribution Center in Belgium has
been so successful that the sports footwear and apparel
company’s European information technology group
recently built its own obeya space.
ING Bank created obeya rooms in several European
countries so operations teams can speed up communication and decision making as the company moves
toward a more agile work culture. “This is the heart of
ING’s transformation,” ING chief operating officer Roel
Louwhoff says proudly during a tour of ING’s obeya
room in Amsterdam. “The purpose is simple: having
the full overview of the status of all projects and solving
issues quickly. . . .You immediately see how everything
fits together.”
Siemens has introduced obeya rooms throughout
Europe to support product development and production process decision making. Siemens quality systems
manager Annemarie Kreyenberg noticed that the obeya
room at her worksite in Germany has changed the company’s culture. “The behaviour of people in this [obeya]
room was an excellent reflection of the progress of the
cultural change,” she observes. “Teams and managers
experimented with new behaviours, creating role models and examples for the entire organization.”
©Sam Edwards/Getty Images
* F. Mathijssen, “The Story of Nike’s Obeya,” Planet Lean, December 11, 2014; A. Kreyenberg, “The Obeya Room—Tool and Mirror for Culture Change,”
in agile42 Connect (Berlin 2015); F. Parisot, “PSA Généralise Les Réunions Virtuelles (PSA Generalizes Virtual Meetings),” L’usine Nouvelle, January 15,
2015; “The Olympian Task of Transforming ING,” News release (ING Bank, February 16, 2017); S. Arlt, “Schöne, neue Arbeitswelt (Beautiful, New Working
Environment),” Deutschlandfunk Kultur, November 7, 2017; M. Korytowska, “Obeya Room in Portfolio Management,” LinkedIn Pulse, February 11, 2019; J.M.
Morgan and J.K. Liker, Designing the Future: How Ford, Toyota, and Other World-Class Organizations Use Lean Product Development to Drive Innovation
and Transform Their Business (New York: McGraw Hill Professional, 2019), 93–109.
team coordination, organizational leaders instil a culture of
teamwork, and the reward system reinforces collaboration
rather than competition among team members. Team effectiveness also benefits from an organizational structure that
clusters work activities within the team and creates fairly
distinct boundaries between the team and other work units.28
Verafin Inc., which we featured in the previous section of
this chapter, has applied several of these environmental conditions to support its teams. The St. John’s, Newfoundland, software company’s founders emphasize teamwork as one of four
core values. The company also has a team-oriented workplace,
including open offices (and no job titles), glass-walled meeting rooms, and casual spaces with massive whiteboards for
impromptu scrums. Merrill Lynch Wealth Management, which
was described at the beginning of this chapter, also provides a
team-friendly environment through a reward system that motivates financial advisors to work in teams rather than alone.29
Team Design Elements
Even in a team-friendly environment, the team’s effectiveness will fall short of its potential if the task characteristics,
team size, and team composition are poorly designed for the
team’s objectives and functioning.
The case study at the beginning of this chapter reported that
investment banks and financial advisory firms have shifted to
teams rather than individuals working alone as the preferred
Chapter Eight
work structure. The main reason is the increasing complexity of investments and other services to meet client needs.
Complex work requires skills and knowledge beyond one
person’s abilities. Teams are particularly well suited for complex work that can be divided into more specialized roles,
particularly when team members in those specialized roles
are able to coordinate frequently with each other.30
Task complexity demands teamwork, but teams also function better when the complex work is well-structured rather than
ambiguous. Team members on an automobile assembly line
have well-structured tasks. They perform the same set of tasks
each day (low task variability -- see Chapter 6) and the work
is predictable enough for well-established procedures (high task
analyzability). The main benefit of well-structured tasks is that
it is easier to coordinate the work among several people.
In contrast, ambiguous and unpredictable tasks are more
difficult to coordinate among team members, which leads to
higher process losses and errors. Fortunately, teams can still
perform these less-structured tasks reasonably well when
members are experienced in well-defined broader roles.
During surgery, for example, medical team members know
generally what to expect of one another even when unique
problems arise.31
Task Interdependence
Another task-related influence on team effectiveness is task
interdependence—the extent to which team members must
share materials, information, or expertise to perform their
jobs.32 Apart from comtask interdependence The
plete independence, there
extent to which employees
are three levels of task
must share materials, informainterdependence, as illustion, or expertise with others
trated in Exhibit 8.3.33 The
to perform their jobs.
lowest level, called pooled
interdependence, occurs when an employee or work unit
shares machinery, technical support, financial support, or
other common (pooled) resources, but otherwise operates
independently from other employees or work units. A higher
level of interdependence occurs when the output of one person or work unit becomes the direct input for another person
or unit. This sequential interdependence typically occurs on
an assembly line because each team member’s output is forwarded to the next person on the line for further assembly of
the product or service.
Reciprocal interdependence, in which work output is
exchanged back and forth among individuals or work units, produces the highest level of interdependence. People who design a
new product or service would typically have reciprocal interdependence because their design decisions affect others involved
in the design process. Any decision made by the design engineers would influence the work of the manufacturing engineers
and purchasing specialists, and vice versa. Employees with
reciprocal interdependence should be organized into teams to
facilitate coordination in their interwoven relationship.
As a rule, the higher the level of task interdependence,
the greater the need to organize people into teams rather
Levels of Task Interdependence
Team Dynamics
208 Part Three
Team Processes
than have them work alone.34 Higher task interdependence
usually requires more intense coordination, and team structures enable better interpersonal communication than when
employees work independently from each other or in different departments. High task interdependence also motivates
most people to be part of the team and to coordinate with
each other. This rule applies when team members have the
same task goals, such as serving the same clients or collectively assembling the same product. When team members have different goals (such as serving different clients)
but have high interdependence with others to achieve those
unique goals, teamwork might create excessive conflict.
Under these conditions, the company should try to reduce
the level of interdependence or rely on supervision as a buffer or mediator among employees.
What is the ideal size for a team? Online retailer Amazon
relies on the “two-pizza team” rule, namely that a team should
be small enough to be fed comfortably with two large pizzas.
This works out to between five and seven employees. At the
other extreme, a few experts suggest that tasks are becoming so complex that many teams need to have more than 100
members.35 Unfortunately, the former piece of advice (twopizza teams) is too simplistic, and the latter seems to have lost
sight of the meaning and dynamics of real teams.
Teams should be large enough to provide the necessary
abilities and viewpoints required for the assigned work, yet
small enough to maintain efficient coordination and meaningful involvement of each member.36 “You need to have a
balance between having enough people to do all the things
that need to be done, while keeping the team small enough
so that it is cohesive and can make decisions effectively
and speedily,” advises Jim Hassell, board member and
until recently Group CEO of BAI Communications, which
designs, builds, and operates global telecommunications networks (including mobile and Wi-Fi networks for the Toronto,
New York, and Hong Kong public transit systems).37
The ideal team size varies with the type of team, the
tasks it is expected to perform, and the available forms of
coordination (see Chapter 13).38 Generally, smaller teams
(say a half-dozen members) operate more effectively than
larger teams because they have less process loss (easier
coordination, less conflict, less time to make decisions,
etc.). Members of smaller teams also tend to feel more
engaged in teamwork because they have more influence on
the group’s norms and goals and feel more responsible for
its successes and failures. Also, members of smaller teams
get to know one another better, which improves mutual trust
as well as perceived support, help, and assistance from those
team members.39
Should companies have 100-person teams if the task is
highly complex? The answer is that a group this large probably isn’t a team, even if management calls it one. A team
exists when its members interact and influence one another,
are mutually accountable for achieving common goals associated with organizational objectives, and perceive themselves as a social entity within an organization. It is very
difficult for everyone in a 100-person work unit to influence
one another and perceive themselves as members of the same
team. However, such complex tasks can usually be divided
into several smaller teams.
Team effectiveness depends on the qualities of the people
who are assigned to those teams.40 To begin with, a team’s
performance depends on how well its members engage in
taskwork, that is, task-related behaviours toward the achievement of the team’s objectives. Taskwork requires team members who are highly motivated, possess the required abilities,
and have clear role perceptions about how and when to perform the assigned work (see MARS model in Chapter 1).
But effective teams demand more than just individuals
who perform their own jobs well. They also need members who are motivated, able, and have clear role perceptions about engaging in teamwork behaviours.41 Teamwork
behaviours maintain the team’s existence and functioning. In
other words, the best performing teams have members who
are effective at performing their tasks and effective at supporting the team’s dynamics. For this reason, RBC Capital
Markets and many firms assess job applicants on their teamwork behaviours, not just their taskwork performance.
The most frequently mentioned teamwork behaviours are
depicted in the “Five Cs” model illustrated in Exhibit 8.4.
Coordinating, communicating, and cooperating are mainly
(but not entirely) about supporting team members on their task,
whereas comforting and conflict resolving primarily maintain
healthy psychological and interpersonal dynamics in the team.42
• Cooperating. Effective team members are willing and able
to work together rather than alone. This includes sharing
resources and being sufficiently adaptive or flexible to
accommodate the needs and preferences of other team
members, such as rescheduling use of machinery so that
another team member with a tighter deadline can use it.
• Coordinating. Effective team members actively manage the team’s work so it is performed efficiently and
harmoniously. This includes keeping the team on track
and helping to integrate the work performed by different
members. To effectively coordinate, team members must
know the other team members’ work to some extent, not
just their own.
Chapter Eight
Team Dynamics
Five Cs of Effective Teamwork Behaviours
• Share resources
• Accommodate others
• Diagnose conflict
• Use best conf licthandling style
Team Member
•Show empathy
• Provide psychological
• Build confidence
• Communicating. Effective team members transmit
information freely (rather than reluctantly), efficiently
(using the best channel and symbols), and respectfully
(minimizing arousal of negative emotions).43 They also
listen actively to co-workers.
• Comforting. Effective team members help co-workers to
maintain a positive and healthy psychological state. They
show empathy, provide psychological comfort, and build
co-worker feelings of confidence and self-worth.
• Conflict resolving. Conflict is inevitable in social settings,
but effective team members have the skills and motivation
to resolve disagreements within the group. This involves
using appropriate conflict-handling styles as well as
diagnostic skills to identify and resolve the structural
sources of conflict.
Team Diversity
Diversity, another aspect of team composition, has both
advantages and challenges for team effectiveness.44 One
advantage of diverse teams is that people from different backgrounds tend to see a problem or opportunity from different
angles. Team members have different mental models, which
increases their likelihood of identifying viable solutions to
difficult problems. A second advantage is that diverse team
members have a broader pool of technical abilities to serve
clients or design new products. This explains why RBC
• Align work with
• Keep team on track
• Share information freely,
ef f iciently, respectfully
• Listen actively
Capital Markets, Merrill Lynch Wealth Management, and
most other firms in the finance industry increasingly rely on
teams rather than individuals to serve clients.
A third advantage of diverse teams is that they often provide better representation of the team’s constituents, such
as other departments or clients from similarly diverse backgrounds. This representation not only brings different viewpoints to the decision; it also gives stakeholders a belief that
they have a voice in that decision process. As we learned
in Chapter 5, voice is an important ingredient in procedural
justice, so stakeholders are more likely to believe the team’s
decision is fair when the team mirrors the surface or deeplevel diversity of its constituents.
Team diversity also presents a number of challenges.
Employees with diverse backgrounds take longer to become
a high-performing team. This occurs partly because people with varied worldviews take longer to reach agreement
on team goals, operational procedures, and informal team
dynamics (norms, roles, etc.). The team development process is also slower because it takes longer to build trust with
co-workers whose personal characteristics, experiences, and
beliefs are different from ours.
A related challenge is that diverse teams are susceptible
to “faultlines”—hypothetical dividing lines that may split a
team into subgroups along gender, ethnic, professional, or
other dimensions.45 These faultlines undermine team effectiveness by reducing the motivation to communicate and
210 Part Three
Team Processes
Teamwork Behaviours in Job Applicants, Graduates, and Co-workers*
of 25,000 employees
in 1,000 companies globally believe
they have the right people on their
of 21,000 students
at U.S. colleges and universities
consider themselves proficient in
of managers in 90
large Canadian private sector companies
identify collaboration/teamwork skills
as most important when evaluating job
of 400 American
employers surveyed say that recent
college graduates are well prepared
at working with others in teams.
of 1,021 hiring managers
say that being team-oriented is a top
soft skill they assess in job applicants.
©Khakimullin Aleksandr/Shutterstock
** Association of American Colleges & Universities, Falling Short? College Learning and Career Success (Washington, DC: Hart Research Associates, January 20,
2015); “Developing Canada’s Future Workforce: A Survey of Large Private-Sector Employers” (Ottawa: Business Council of Canada and Aon Hewitt Inc., March
2016); “Are College Graduates ‘Career Ready’?,” News Release (Bethlehem, PA: National Association of Colleges and Employers, February 19, 2018); “The 2019
Employee Engagement Report” (Seattle: TINYpulse, February 21, 2019); “Forty Percent of Employers Plan to Hire Full-Time Workers This Year, Forty-Seven Percent
Recruiting Part-Time Workers,” News Release (Chicago: Career Builder, March 5, 2019).
coordinate with teammates on the other side of the hypothetical divisions. In contrast, members of homogeneous teams
experience higher satisfaction, less conflict, and better interpersonal relations. As a result, homogeneous teams tend to
be more effective on tasks requiring a high degree of cooperation and coordination, such as emergency response teams.
Team Processes
The third set of elements in the team effectiveness model,
called team processes, includes team development, norms,
roles, cohesion, trust, and team mental models. As we
warned earlier in this chapter, the literature has varied and
sometimes confounding definitions of team processes. We
define team processes as cognitive and emotional dynamics
of the team that continually change with the team’s ongoing evolution and development. In other words, this section
looks at the continuously evolving collective beliefs, expectations, and feelings of the team as well as how those team
dynamics influence team effectiveness.
Team development is at the heart of team processes because
the other dynamics—shaping norms, roles, cohesion, trust,
and mental models—are embedded in team development.
Team members resolve several issues and pass through several stages of development before emerging as an effective
work unit. They need to get to know and trust one another,
understand and agree on their respective roles, discover
appropriate and inappropriate behaviours (norms), develop
mutual understanding of the team’s objectives and their coordination in that process (team mental models), and develop a
strong bond with the team and its members (cohesion).
Numerous team development models have been proposed
over the past half century.46 The model shown in Exhibit 8.5
is the most popular and captures the complexity of the team
development processes better than most.47 The diagram shows
teams moving systematically from one stage to the next, while
the dashed lines illustrate that teams might—and often do—
fall back to an earlier stage of development as new members
join or other conditions disrupt the team’s maturity.
Forming, the first stage of team development, is a period
of testing and orientation in which members learn about one
another and evaluate the benefits and costs of continued
membership. People tend to be polite, will defer to authority, and try to find out what is expected of them and how
they will fit into the team. The storming stage is marked by
interpersonal conflict as members become more proactive
and compete for various team roles. Members try to establish
norms of appropriate behaviour and performance standards.
Chapter Eight
Team Dynamics
Global Connections 8.2
The Rijksmuseum in Amsterdam is the world’s leading
gallery of Dutch art and history. It is also a showcase
for the power of diverse teams. Most museums organize their public display areas around paintings, glass,
decorative arts, and other specialized collections. In
contrast, Rijksmuseum recently reorganized its exhibit
areas around century time periods.
“When you organize your own memory, you usually
do it by important dates,” explains Rijksmuseum general
director Taco Dibbits. “We said, well if [Rijkmuseum represents] the country’s memory and you organize it by
dates you will have a chronological display.”
To display diverse objects aesthetically and historically
together within each time period, the museum formed
cross-functional teams that included representation of
staff from the numerous specialized collections. Over
18 months, each working group developed proposals
about how the display area for that century should be
organized and which objects should be publicly shown.
The process wasn’t easy because the curators of each
specialization previously had their own distinct section of
the museum and worked autonomously from the others.
There was also ambiguity about which types of objects
should receive priority for each time period. But through
their diversity, the teams generated unique ideas and
their members gained a fuller understanding and appreciation of co-workers from other specializations.
The proposals submitted by the initial working
groups were promising, but they included far too many
items for the space available. “Our solution was to
basically dissolve the task forces and assemble new
ones,” says Dibbits. “Their new mission was to create a
selection one-third the size of what the first groups had
proposed.” In addition, the new diverse teams had to
provide written justification for inclusion of the objects
retained from the first team’s list. Dibbits observed that
creating the second set of teams with documented
justification for their decisions “gave all the specialists
a feeling of ownership in the creation of the museum’s
offerings, even beyond their own area of expertise.”
Rijksmuseum continues to form new temporary
teams for various initiatives and strategic issues. The
teams are typically limited to between five and seven
members. “If you have more than seven people, it’s difficult to have a fruitful discussion, because by the time
everyone gets to have their say, you’ve lost speed,”
Dibbits points out. It is also more difficult for employees
to remain silent when they are in small teams. One limitation is that small teams don’t enable representation
from all of the museum’s specialist groups. “Ultimately,
it’s important to communicate from the start that everyone’s time on these task forces will come,” says Dibbits.
“We continue to regularly mix up the people in these
groups so that everyone has a chance to participate.”
©Danita Delimont/Alamy Stock Photo
* C. Higgins, “Rijksmuseum to Reopen after Dazzling Refurbishment and Rethink,” The Guardian, April 5, 2013; TEFAF, TEFAF New York Fall 2016—A
Conversation with Taco Dibbits, Director of the Rijksmuseum, YouTube (New York, 2016), https://www.youtube.com/watch?v=lmzwcp1-IVQ; W. Aghina and
A. Webb, “The Rijksmuseum’s Agile Process: An Interview with Director Taco Dibbits,” McKinsey Quarterly, October 2018.
During the norming stage, the team develops its first real
sense of cohesion as roles are established and a consensus
forms around group objectives and common as well as complementary team-based mental models. By the performing
stage, team members have learned to efficiently coordinate
and resolve conflicts. In high-performance teams, members are highly cooperative, have a high level of trust in one
another, have functional shared mental models of group
objectives and work processes, and identify with the team.
Finally, the adjourning stage occurs when the team is about
to disband. Team members shift their attention away from
task orientation to a relationship focus.
This model depicts team development fairly well because
it identifies and incorporates the various other team processes
that occur over time. It notes that teams become cohesive,
develop norms to guide behaviour, assign roles, form team
212 Part Three
Team Processes
mental models, and develop trust in one another. However, the
model is not a perfect representation of team development.48
It does not show that some teams remain in a particular stage
longer than others and does not explain why teams sometimes
regress back to earlier stages of development. Perhaps most
important, this model does not explain the intricacies of how
norms, cohesion, mental models, and other team dynamics
evolve (often rapidly) over time. Fortunately, these team processes are explained by separate theories. The remainder of this
section describes each of these, beginning with team norms.
Norms are the informal rules and shared expectations that
groups establish to regulate the behaviour of their members.
Norms apply only to behaviour, not to private thoughts or
feelings. Furthermore, norms exist only for behaviours that
are important to the team.49 The team development model
in Exhibit 8.5 suggests that
norms The informal rules
team norms develop during
and shared expectations
the storming stage, likely
that groups establish to regbecause conflict often
ulate the behaviour of their
occurs when members try
to reach agreement on what
behaviour is expected or forbidden. However, it is more accurate to say that norms begin as soon as the team forms and
that some norms continue to change over the team’s lifespan.
Teams develop norms for a few reasons. First, most norms
develop when members associate these behaviours with the
team’s performance or the well-being of its members. The perceived value of norms motivates members to enact them as well
as influence others to do the same.50 Some norms originate
from a critical incident; for instance, a norm of wearing safety
glasses emerges after a team member is seriously hurt from not
wearing them. Other norms are brought into the team due to
experiences that some members have had in previous teams.51
Second, team norms develop because they improve predictability and conflict-avoidance in co-worker relations.
Newcomers, for instance, try to fit in with the group by
actively discovering and behaving consistently with the
team’s norms. Third, teams develop norms to routinize
behaviour with minimal cognitive effort, which improves
social order and coordination of each member’s activities.
This explains why norms often develop regarding seemingly
minor issues, such as where people sit in meetings.
An important feature of team norms is that they are
enforced.52 Co-workers display their displeasure if we are
absent from work too often or don’t have our part of a project
Stages of Team Development
• Task oriented, committed
• Ef ficient coordination
• High cooperation and trust
• Conflicts resolved quickly
• Establish roles
• Agree on team objectives
• Form team mental models
• Develop cohesion
• Interpersonal conf lict
• Compete for team roles
• Inf luence goals and means
• Establish norms
• Discover expectations
• Evaluate value of membership
• Defer to existing authority
• Test boundaries of behaviour
Chapter Eight
completed on time. Norms are also directly reinforced through
praise from high-status members and easier access to valued
resources. These forms of peer pressure and reinforcement
can occur even when team members work remotely from
one another. But team members often conform to prevailing
norms without direct reinforcement or punishment because
they identify with the group and want to align their behaviour
with the team’s expectations. The more closely the person’s
social identity is connected to the group, the more the individual is motivated to obey the team’s norms.53
Developing and Changing Team Norms
Two of the best ways to establish desired norms in new teams
are to select team members whose values and past behaviour
are compatible with those norms and to clearly state the
norms when those people are assigned to the team. As an
example, if organizational leaders want their teams to have
strong safety norms, they should hire people who already
value safety and clearly state the importance of safety during
one of the team’s first meetings.
For existing teams, research indicates that leaders have
the capacity to remove dysfunctional norms by cautioning team members against these behaviours. They can also
introduce desired norms through ongoing coaching of team
members.54 Another suggestion that works sometimes (but
not always) is to introduce team-based rewards that counteract dysfunctional norms. Finally, if dysfunctional norms are
deeply ingrained and the previous solutions don’t work, it
may be necessary to disband the group and form a new team
whose members have more appropriate norms.
Team Dynamics
An inherent part of the team development process is assigning and maintaining team roles. A role is a set of behaviours
that people are expected to
perform because they hold
role A set of behaviours
specific formal or inforthat people are expected to
perform because they hold
mal positions in a team
specific formal or informal
and organization.55 Roles
positions in a team and
are similar to norms in the
sense that they both establish and reinforce expected
patterns of behaviour. However, most norms apply to all
team members whereas a role typically applies to one or a
few specific team members.
Some team roles are formally assigned to individual
members during the team composition aspect of team design.
For example, most teams have a leader, who is expected to
help clarify task responsibilities, ensure that everyone has an
opportunity to present their views in meetings, and so forth.
However, many roles are adopted informally during the team
development process. Informal roles are shared, but many are
eventually associated with specific team members through
subtle positioning and negotiation. In many cases, employees
are attracted to roles that suit their personality and values. In
other cases, team members encourage specific co-workers to
take on selected roles.
Several experts have tried to categorize the dozens of team
roles that have been proposed over the years.56 One recent
model, shown in Exhibit 8.6, identifies six role categories:
Examples of Team Roles
A team member who acts to structure what the team is doing. An Organizer also keeps track of accomplishments and how the team
is progressing relative to goals and timelines.
A team member who willingly takes on work and gets things done. A Doer can be counted on to complete work, meet deadlines,
and take on tasks to ensure the team’s success. This person should focus on goal accomplishment.
A team member who will push the team to explore all aspects of a situation and to consider alternative assumptions, explanations, and
solutions. A Challenger often asks “why” and is comfortable debating and critiquing. Think of this role as the team’s devil’s advocate.
A team member who regularly generates new and creative ideas, strategies, and approaches for how the team can handle various
situations and challenges. An Innovator often offers original and imaginative suggestions.
A team member who helps establish norms, supports decisions, and maintains a positive work atmosphere within the team. A Team
Builder calms members when they are stressed, and motivates them when they are down.
A team member who helps bridge and connect the team with people, groups, or other stakeholders outside of the team. Think of
Connectors as “boundary spanners,” who ensure good working relationships between the team and “outsiders.”
214 Part Three
Team Processes
What team roles do you prefer? You can discover which roles you prefer in meetings and similar team
activities by locating this self-assessment in Connect.
organizer, doer, challenger, innovator, team builder, and connector. More broadly, most team roles focus on either task
performance (taskwork) or team maintenance (teamwork).
Taskwork roles might include coordinating the team, providing constructive critique of the team’s plans, and motivating
team members when effort is lagging. Teamwork roles might
include providing emotional support when the team is frustrated, maintaining harmony among team members, and creating opportunities for social interaction among team members.
Another team process is team cohesion, which refers to the
degree of attraction people feel toward the team and their
motivation to remain members. A team has high coheteam cohesion The degree of
sion when its members are
attraction people feel toward
attracted to the team, take
the team and their motivation
to remain members.
ownership of the team’s
success, make the team
part of their self-concept, are committed to the team’s goals
or tasks, and feel a collective sense of team pride.57 Thus,
team cohesion is an emotional experience, not just a calculation of whether to stay or leave the team.
Influences on Team Cohesion
Team cohesion increases with team development. Six of the
most important influences on team cohesion are described
below. Some of these conditions strengthen the individual’s
identity with the team; others strengthen the individual’s
belief that team membership will fulfil personal needs.
• Member similarity. A well-established research finding is that we are attracted more to co-workers who are
similar to us.58 This similarity-attraction effect occurs
because we assume that people are more trustworthy and
more likely to accept us if they look and act like us. We
also believe that these similar others will create fewer
conflicts and violations of our expectations. Thus, teams
have higher cohesion or become cohesive more quickly
when members are similar to one another. In contrast,
high cohesion is more difficult and takes longer for
teams with diverse members. This difficulty depends on
the form of diversity, however. Teams consisting of people from different job groups seem to get along just as
well as teams of people from the same job.59
• Team size. Smaller teams tend to have more cohesion
than larger teams. One reason is that it is easier for a few
people to agree on goals and coordinate work activities,
so they experience less conflict. Another reason is that
members have more influence in smaller teams, so they
feel a greater sense of involvement and ownership in the
team. However, small teams have less cohesion when
they lack enough members to perform the required tasks.
• Member interaction. Teams tend to have more cohesion
when their members interact with one another fairly
regularly. More frequent interaction occurs when team
members perform highly interdependent tasks and
work in the same physical area or at least communicate
remotely through channels with high social presence.
• Somewhat difficult entry. Teams tend to have more cohesion when entry to the team is restricted. The more elite
the team, the more prestige it confers on its members,
and the more they tend to value their membership in the
unit. At the same time, research suggests that severe initiations can weaken team cohesion because of the adverse
effects of humiliation, even for those who successfully
endure the initiation.60
• Team success. Team cohesion increases with the team’s
success because people are attracted to groups that fulfil
their needs and goals.61 Furthermore, individuals are
more likely to identify with successful teams than with
teams that often fail to achieve their goals.
• External competition and challenges. Teams tend to have
more cohesion when they face external competition or a
challenging objective that is important to them. This might
include a threat from an external competitor or friendly
competition from other teams. Employees value their
membership on the team because of its ability to overcome
the threat or competition and as a form of social support.
However, cohesion can dissipate when external challenges
overwhelm the team and threaten its success or viability.62
Consequences of Team Cohesion
Teams with higher cohesion tend to perform better than those
with low cohesion.63 In fact, the team’s existence depends
on a minimal level of cohesion because it motivates team
members to remain members and to help the team achieve
its objectives. Members of high-cohesion teams spend more
time together, share information more frequently, and are
Chapter Eight
Team Dynamics
Global Connections 8.3
When Patrick Mathieu became a firefighter at the Fire
Rescue Department in Waterloo, Ontario, he soon
learned that communal meals support the team’s
cohesion and trust. “In the fire service, we pride ourselves
on teamwork and unity,” says Mathieu. “Eating and
cooking is part of our firefighter culture and I have seen
the immense team-building benefits that result from a
platoon cooking together.”
A recent study supports Mathieu’s observations.
It found that fire stations where the team usually ate
together performed better than stations where firefighters
ate alone. The higher performance was attributed to better
cooperation, trust, and other outcomes of high cohesion.
Mathieu has become a popular chef at his fire station
in Waterloo and recently competed in a Canada-wide
cooking contest. But the favourite dish among firefighters
in his platoon is jalapeño kettle chip fish tacos, partly
because everyone is involved in its creation. “With
everyone in the kitchen, we talk, laugh, joke and create
something special together,” he says. “It brings us in for
bonding, just like a family dinner.”
Mathieu notes that there is one risk of cooking great
meals in a fire station. “You make the call for everyone
to come to dinner. Boom—the alarm goes off. Yep, the
meal sits and waits until we come back.”
©Waterloo firefighter and The FireHouse Chef Cookbook author
Patrick Mathieu, @stationhousecco, stationhouse_
* K.M. Kniffin et al., “Eating Together at the Firehouse: How Workplace Commensality Relates to the Performance of Firefighters,” Human Performance 28,
no. 4 (2015): 281–306; J. Hicks, “Ready to Handle the Heat: Waterloo Firefighter a Culinary Contender on Chopped Canada,” Waterloo Regional Record
(Kitchener, Ontario), January 29, 2015, A1; P. Mathieu, “Recipe Rescue: Bond over Meal Prep,” Canadian Firefighter, April 11, 2016; “How Food Helps Both
Firefighters and Families Bond,” CBC News, December 21, 2017.
more satisfied with one another. They give each other more
social support in stressful situations and work to minimize
dysfunctional conflict.64 When conflict does arise, high-cohesion team members tend to resolve their differences swiftly
and effectively.
The relationship between team cohesion and team performance depends on two conditions, however. First, team cohesion has less effect on team performance when the team has
low task interdependence.65 High cohesion motivates employees to coordinate and cooperate with other team members.
But cooperation and coordination are less critical when the
team members don’t depend on each other to perform their
jobs (i.e., low task interdependence), so the motivational
effect of high cohesion is less relevant under those conditions.
Second, the effect of cohesion on team performance
depends on whether the team’s norms are aligned or conflict
with organizational objectives.66 As Exhibit 8.7 illustrates,
teams with high cohesion perform better when their norms
support the company’s goals, whereas higher cohesion can
potentially reduce team performance when norms conflict
with organizational objectives. This effect occurs because
cohesion motivates employees to perform at a level more
consistent with team norms. If a team’s norm tolerates or
encourages absenteeism, for example, employees will be
more motivated to take unjustified sick leave. If the team’s
norm discourages absenteeism, employees are more motivated to avoid taking sick leave.
One last comment about team cohesion and performance:
A few paragraphs ago, we stated that team performance
(success) causes cohesion, whereas we are now saying that
team cohesion causes team performance. Both statements
are correct. Teams with higher cohesion perform better,
and teams with better performance become more cohesive.
Which direction is stronger? A major review of past studies
reported that in established teams (i.e., typical of teams in
most organizations), cohesion has a much stronger effect on
team performance than the effect of team performance on
team cohesion. Only lab experiments that studied short-lived
216 Part Three
Team Processes
Effect of Team Cohesion on Task Performance
Team norms
high task
High task
Team norms
conflict with
low task
Low task
student teams found that both directions were equal. Student
teams typically have fairly low cohesion due to their brief
existence and non-essential purpose to most members.67
Any relationship—including the relationship among team
members—depends on a certain degree of trust.68 Trust
refers to positive expectations one person has
trust Positive expectations
one person has toward
toward another person in
another person or group in
situations involving risk
situations involving risk.
(see Chapter 4). Trust is
ultimately perceptual; we
trust others on the basis of our beliefs about their ability,
integrity, and benevolence. Trust is also emotional; we experience positive feelings toward those we trust.69
Trust is built on three foundations in a hierarchy from
lowest to highest: calculus, knowledge, and identification
(see Exhibit 8.8).70 Calculus-based trust represents a logical
calculation that other team members will act appropriately
because they face sanctions if their actions violate reasonable expectations.71 It offers the lowest potential trust and is
easily broken by a violation of expectations. Some scholars
suggest that calculus-based trust is not trust at all. Instead, it
might be trust in the system rather than in the other person.
In any event, calculus-based trust alone cannot sustain a
team’s relationship because it relies on deterrence.
Knowledge-based trust is based on the predictability of
another team member’s behaviour. This predictability refers
only to “positive expectations”—as the definition of trust
states—because you would not trust someone who tends to
engage in harmful or dysfunctional behaviour. Knowledgebased trust includes our confidence in the other person’s
abilities, such as the confidence that exists when we trust
a physician. It also includes perceptions of the other person’s reliability and consistency in performing good deeds
or enacting their values.72 Knowledge-based trust offers a
higher potential level of trust than calculus-based trust and it
is more stable because it develops over time.
Identification-based trust is based on mutual understanding and an emotional bond among team members. It occurs
when team members think, feel, and act like one another.
High-performance teams exhibit this level of trust because
they share the same values and mental models. Identificationbased trust is potentially the strongest and most robust of all
three types of trust.73 The individual’s self-concept is based
partly on membership in the team whose members hold similar values, so any transgressions by other team members are
quickly forgiven. People are more reluctant to acknowledge a
violation of this high-level trust because it strikes at the heart
of their self-concept.
Dynamics of Team Trust
Employees typically join a team with a moderate or high
level—not a low level—of trust in their new co-workers.74
The main explanation why people have high trust (called
swift trust) at the outset is that they usually believe fellow
team members are reasonably competent (knowledge-based
trust) and they tend to develop some degree of social identity with the team (identification-based trust). Even when
working with strangers, most employees display some level
Chapter Eight
Team Dynamics
Three Foundations of Trust in Teams
Level of
Type of trust
Identif icationbased trust
• Based on common mental models and values
• Increases with person’s social identity with team
Knowledgebased trust
• Based on predictability and competence
• Fairly robust
Calculusbased trust
• Based on deterrence
• Fragile and limited potential because dependent
on punishment
of trust, if only because it supports their self-view of being
a good person. However, trust is fragile in new relationships
because it is based on assumptions rather than well-established experience.75 Studies report that trust tends to
decrease rather than increase over time. This is unfortunate,
because employees become less forgiving and less cooperative toward others as their level of trust decreases, which
damages both teamwork and taskwork.
Mental models are visual or relational images in our mind
that we develop to describe, explain, and predict the world
around us (see Chapter 3).
Team mental models are
mental models Knowledge
structures that we develop to
cognitive images that team
describe, explain, and predict
members form about the
the world around us.
team’s tasks, relationship
dynamics, and knowledge
repository.76 Team members have both shared and complementary mental models. As a team matures, its members form
shared mental models, meaning that they develop similar
images and expectations about the team’s objectives, shared
values, behaviour norms, and work style, as well as a general
picture of how each member participates in the work process.
Complementary mental models are cognitive images
held by specific (rather than all) team members but that are
compatible with the mental models held by other team members. Each team member has unique images of how the team
operates because they have a unique background and are
located in different parts of the work process than other team
members. For example, engineering team members would
view customers somewhat differently from how marketing
members of that team view customers. In successful teams,
each member’s mental model operates in harmony with the
unique mental models of other team members.
Shared and complementary mental models enable team
members to establish effective coordinating routines.77 In
high-performing teams, each member develops habitual
work practices that coordinate almost automatically with the
behaviours and expectations of other members. This alignment of mental images and predictions also supports the
perception that the group is a functioning social entity with
meaningful purpose and performance capabilities.
Team mental models also help team members to know
where knowledge is located within the team.78 Members of
cross-functional teams, for instance, have diverse knowledge
and skills (production, legal, marketing, technology, etc.)
that are collectively applied to achieve the team’s objectives. To make better decisions or serve clients well, team
members often need to consult with co-workers who possess
specific skills and knowledge. This awareness of the team’s
diverse knowledge repository is therefore a vital part of team
mental models.
How trusting are you? You can discover your trust propensity by locating this self-assessment in
218 Part Three
Team Processes
Teams require time to become cohesive, form productive
norms, assign roles, build knowledge and identification-level
trust, and form functioning shared and complementary mental models. Team building consists of activities that attempt
to speed up or improve these team development processes.79
As we have emphasized throughout this section, team development consists of several diverse team processes. Therefore,
not surprisingly, there are several types of team building to
serve those processes. Some team-building interventions are
task-focused. They clarify the team’s performance goals,
increase the team’s motivation to accomplish these goals, and
establish a mechanism for systematic feedback on the team’s
goal performance. A second type of team building focuses on
improving the team’s problem-solving skills.
A third team building category clarifies and reconstructs
each member’s perception of their role as well as the role
expectations that member has of other team members. Roledefinition team building also helps the team to develop
shared and complementary mental models, such as how to
interact with clients, maintain machinery, and engage in
meetings.80 A fourth—and likely the most popular—type of
team building is aimed at helping team members to improve
interpersonal relations, such as building trust in each other
and becoming a more cohesive team.81 Popular interventions
such as wilderness team activities, paintball wars, and obstacle-course challenges are intended to support these team
Do team building interventions support team development
and associated processes? The answer is that all four types of
team building are potentially effective, but some interventions work better than others and in some situations more
than others.82 Goal setting tends to be the most successful
type of team building, although role clarification and adventure programs (to improve interpersonal relations) are also
effective to some extent. Interventions are also more successful when they focus on one rather than multiple team-building
However, many team-building activities are less successful.83 One problem is that team building interventions are
used as general solutions to ambiguously defined team problems. A better approach is to begin with a sound diagnosis of
the team’s health and then select team-building interventions
that address specific weaknesses. Another problem is that
team building is applied as a one-shot medical inoculation
that every team should receive when it is formed. In truth,
team development is ongoing, so team building should occur
at various points during the team’s existence. Finally, we
must remember that team building occurs on the job, not just
on an obstacle course or in a national park. Organizations
should encourage team members to reflect on their work
experiences and to experiment with just-in-time learning for
team development.
The team effectiveness model is a useful template for
understanding how teams work—and don’t work—in organizations. With this knowledge in hand, let’s investigate two
types of teams that have become important in organizations:
self-directed teams and remote teams.
Self-Directed Teams
Buurtzorg Nederland employs almost 15,000 professionals
(mostly registered nurses) in more than 1,000 self-directed
teams across the Netherlands and other countries. “Selfmanaging teams have professional freedom with responsibility,” says Buurtzorg’s website. Each self-directed team
consists of up to 12 nurses responsible for between 50 and
60 home-care patients, most of whom are elderly, disabled,
or terminally ill. The team members have autonomy to organize the work, make decisions, and build their own caseload of new clients. Performance is measured at the team
level, including patient satisfaction, work efficiency, and
cost savings. Independent studies report that Buurtzorg’s
self-directed teams are significantly more cost-efficient
than traditional (mostly non-team) services by competitors.
Employees also enjoy the team structure. The company has
been the top employer in the Netherlands for several consecutive years.84
Buurtzorg Nederland is a global model of an organization
designed around self-directed teams. Self-directed teams
(SDTs) are cross-funcself-directed teams
tional groups organized
(SDTs) Cross-functional work
around work processes that
groups that are organized
complete an entire piece
around work processes,
of work requiring several
complete an entire piece of
interdependent tasks and
work requiring several interhave substantial autonomy
dependent tasks, and have
substantial autonomy over the
over the execution of those
execution of those tasks.
This definition
captures two distinct features of SDTs. First, these teams complete an entire piece
of work requiring several interdependent tasks. Employees
within the team are clustered together with minimal interdependence or interaction with people outside the team.
The result is a close-knit group of employees who depend
on each other to accomplish the team’s work objectives. The
second distinctive feature of SDTs is that they have substantial autonomy over the execution of their tasks. In particular,
these teams plan, organize, and control work activities with
little or no direct involvement of a higher-status supervisor.
Chapter Eight
Team Dynamics
GE’s (General Electric’s) aviation plant in Bromont, Quebec, manufactures parts used in the world’s most sophisticated aircraft
engines for Boeing, Airbus, and other aerospace firms. It is also a world leader in automation and robotics. But you won’t find
any managers on the plant floor. For the past three decades, the Bromont plant has relied on self-directed teams to get the
work done. Production planning, manufacturing process improvements, vacation schedules, and other managerial decisions
are determined by the teams themselves. “We say we need x output, and then [production teams] are left to decide, how do
they get all that done?” explains a human resources leader at GE Bromont. “That’s how a full teaming system works.”*
* N. Van Praet, “GE to Modernize Its Aircraft Engine Parts Plant in Quebec,” Globe & Mail, February 9, 2017; S. Kessler, “GE Has a Version of Self-Management
That Is Much like Zappos’ Holacracy–and It Works,” Quartz, June 6, 2017; C. Thatcher, “Smart Factory: GE Aviation,” Skies Magazine, August 2, 2017.
Self-directed teams are found in several industries. Most
of the top-rated manufacturing firms in North America
apparently rely on SDTs.86 Indeed, self-directed teams have
become such a popular way to organize employees that many
companies don’t realize they have them. The popularity of
SDTs is consistent with research indicating that they potentially increase both productivity and job satisfaction.87 For
instance, one study found that car dealership service shops
that organize employees into SDTs are significantly more
profitable than shops where employees work without a team
structure. Another study reported that both short- and longterm measures of customer satisfaction increased after street
cleaners in a German city were organized into SDTs.
The success of self-directed teams depends on several factors.88 SDTs should be responsible for an entire work process, such as making an entire product or providing a service.
This structure keeps each team sufficiently independent
from other teams, yet it demands a relatively high degree of
interdependence among employees within the team.89 SDTs
should also have sufficient autonomy to organize and coordinate their work. Autonomy allows them to respond more
quickly and effectively to client and stakeholder demands.
It also increases intrinsic motivation among team members. Finally, SDTs are more successful when the work site
and technology support coordination and communication
among team members. Too often, management calls a group
of employees a “team,” yet the work layout, assembly-line
structure, and other technologies isolate the employees from
one another.
Remote (Virtual) Teams
Chapter 1 described how remote work—performing work
from home or other non-business sites—has become a
common arrangement in most organizations. However, the
COVID-19 pandemic made remote work more appealing
and necessary as a productive way to apply social distancing
and self-isolation practices. Most employees work in teams
220 Part Three
Team Processes
for some or all of their tasks, so the increasing popularity of
remote work has produced more remote teams.
Remote teams (also known as virtual or distributed teams)
are teams whose members operate across space, time, and organizational boundaries and
remote teams Teams whose
are linked through informamembers operate across
tion technologies to achieve
space, time, and organizaorganizational
tional boundaries and are
linked through information
technologies to achieve organizational tasks.
ways: (1) one or more members work remotely at least
some of the time rather than always being co-located (working
in the same physical area as co-workers), and (2) due to their
lack of co-location, members of remote teams depend on information technologies in addition to or instead of face-to-face
interaction to communicate and coordinate their work effort.
Teams vary in their degree of remoteness (or virtuality).
Team remoteness increases with the geographic dispersion of
team members, percentage of members who work apart, and
percentage of time that members work apart.91 For example,
a team has minimal remoteness when most of its members
work in the same physical location most days and only one
or two work from home occasionally. High remoteness exists
when team members are spread around the world and few
members have met the others face to face.
The social distancing and self-isolation requirements in
the recent COVID-19 pandemic have made remote teams
more commonplace. However, these teams were gaining
popularity in organizations long before the recent pandemic.
One factor is that an increasing percentage of employees
perform knowledge work (rather than physical production
work), which enables them to do their job from almost anywhere. Second, information technologies have made it easier than ever to communicate and coordinate remotely with
other knowledge workers.92 A third factor is the increasing
recognition that the orgahuman capital The knowlnization’s
edge, skills, abilities, creative
advantage is its human
thinking, and other valued
capital—the knowledge,
resources that employees
skills, abilities, creativity,
bring to the organization.
and other valued resources
that employees bring to the organization. Leveraging the
potential of human capital typically occurs through teams,
many of which have degrees of remoteness because staff
members are distributed across several cities and countries.
challenges increase with the team’s remoteness, particularly when it exists for only a short time.93 Fortunately, OB
research has identified the following strategies to minimize
most remote team problems.94 First, remote team members need to apply the effective team behaviours (the five
Cs) described earlier in this chapter. They also require good
communication technology skills, self-leadership skills to
motivate and guide their behaviour without peers or bosses
nearby, and emotional intelligence to decipher the feelings
of other team members from text messages and other limited
communication media.
Second, remote teams should have a toolkit of communication channels (messaging, online whiteboards, video conferencing, etc.) as well as the freedom to choose the channels
that work best for them.95 This recommendation may seem
obvious, but unfortunately senior management tends to
impose technology on remote teams—often based on advice
from external consultants—and expects team members to use
the same communication technology throughout their work.
In contrast, research suggests that communication channels
gain and lose importance over time, depending on the task
and level of trust.
Third, remote teams need plenty of structure. In one
review, many of the principles for successful remote
teams related mostly to creating these structures, such as
clear operational objectives, documented work processes,
and agreed-on roles and responsibilities.96 The final recommendation is that remote team members should meet
face-to-face fairly early in the team development process.
This idea may seem contradictory to the entire notion of
remote teams, but so far, no technology has replaced faceto-face interaction for high-level bonding and mutual
Team Decision Making
Self-directed teams, remote teams, and practically all other
groups are expected to make decisions. Under specific conditions, teams are more effective than individuals at identifying problems, choosing alternatives, and evaluating their
decisions. To leverage these benefits, however, we first need
to understand the constraints on effective team decision
making. Then, we look at specific team structures that try to
overcome these constraints.
Remote teams face all the challenges of traditional teams,
as well as the issues arising from time and distance. These
Anyone who has spent enough time in the workplace can
recite several ways in which teams stumble in decision
Chapter Eight
Team Dynamics
Remote teams were rare before the Internet. Today, they
are almost as commonplace as face-to-face teams. To
some extent, remote teams have even become “cool.”
But whether they are stylish or commonplace, remote
teams seem to be increasingly necessary for an organization’s competitive advantage. In spite of the importance of
remote teams, there are a few arguments against them.*
Critics don’t deny the potential value of creating these
teams. Rather, they have added up the negative features
and concluded that they outweigh the benefits. A few
organizations have even curtailed the extent that employees are allowed to work remotely because of possible
problems with their physical absence from the workplace.
One persistent problem is that remote teams lack the
richness of face-to-face communication. We’ll provide
more detail about this important matter in Chapter 9, but
no information technology to date offers the same degree
of social presence or information richness as communication among people located in the same room.
Another problem is that trust among remote team members is either lower or more fragile compared with co-located team members.** In fact, experts offer one main
recommendation to increase trust among remote team
members—have them spend time together as co-located
A third drawback with remote teams is that the farther
away people are located, the more they differ in experiences, beliefs, culture, and expectations. These differences can be advantageous for some decisions, of course,
but they can also be a curse for team development and
Here’s one more reason why companies should think
twice before relying on remote teams: People seem to have
less influence or control over distant than over co-located
co-workers. A team member who stops by your cubicle to
ask how your part of the report is coming along has much
more effect than an impersonal—or even a flaming—email
from afar.
Perhaps that is why surveys reveal less satisfaction with
remote team members than co-located team members.***
Surveys report that remote employees believe other team
members are less willing to support them and more likely to
say bad things behind their back compared to co-located
co-workers. Remote workers also receive more complaints
than co-located colleagues about working ineffectively
(falling behind on projects, missing deadlines, etc.).
* G.R. Berry, “Enhancing Effectiveness on Virtual Teams: Understanding Why Traditional Team Skills Are Insufficient,” The Journal of Business Communication 48,
no. 2 (2011): 186–206; J.H. Dulebohn and J.E. Hoch, “Virtual Teams in Organizations,” Human Resource Management Review 27, no. 4 (2017): 569–74; S. Mak
and S.W.J. Kozlowski, “Virtual Teams: Conceptualization, Integrative Review, and Research Recommendations,” in The Cambridge Handbook of Technology and
Employee Behavior, ed. R.N. Landers, Cambridge Handbooks in Psychology (Cambridge: Cambridge University Press, 2019), 441–79.
** J.V. Hacker et al., “Trust in Virtual Teams: A Multidisciplinary Review and Integration,” Australasian Journal of Information Systems 23 (2019), https://doi.
*** Long-Distance Loathing (Summary and Data), (Provo, Utah: VitalSmarts, March 2009); “Virtual Reality: Remote Employees Experience More Workplace Politics
Than Onsite Teammates,” News Release (Provo, Utah: VitalSmarts, November 2, 2017).
making. The four most common problems are time constraints, evaluation apprehension, pressure to conform, and
Time Constraints
Committees keep minutes and waste hours. This popular
saying captures the fact that teams take longer than individuals to make decisions.98 Teams consume time organizing,
coordinating, and maintaining relationships (i.e., process
losses). Team members require time to build rapport, agree
on rules and norms of behaviour in the decision process, and
understand one another’s ideas.
Another time-related constraint in most team structures is
that only one person can speak at a time.99 This problem, known
as production blocking,
production blocking A time
undermines idea generation
constraint in team decision
in a few ways. First, team
making due to the procedural
members need to listen in
requirement that only one
person may speak at a time.
on the conversation to find
an opportune time to speak
up, but this monitoring makes it difficult for them to concentrate on their own ideas. Second, ideas are fleeting, so the longer participants wait to speak, the more likely their flickering
ideas will die out. Third, team members might remember their
fleeting thoughts by concentrating on them, but this causes
them to pay less attention to the conversation. By ignoring
what others are saying, team members miss other potentially
good ideas.
222 Part Three
Team Processes
Global Connections 8.4
Cesar Abeid lives in London, Ontario, where he leads
15 customer service employees (called happiness
engineers) at Automattic. Abeid’s team members work
well together even though they don’t physically work
together. In fact, Abeid is the only Automattic employee
who lives in London, Ontario.
Automattic, which makes the blogging platform
WordPress and other popular site-building products, is
a completely distributed organization. It has no physical
head office (its mailing address is a UPS postal box in
San Francisco) and all of its 1,200 employees work in
remote teams from their home locations in 75 countries.
More than 50 Automattic employees live across
Canada — from Dawson City, Yukon, to Bedford, Nova
Scotia. Even Automattic’s executives are distributed. For
example, the head of engineering for WordPress VIP
lives near Barrie, Ontario.
One key reason for the success of Automattic’s distributed teams is that every group meets face-to-face
at least twice each year. “Each team will have their own
team meetup,” usually in the spring or early summer,
Abeid explains. “That’s a week that we do some work
together, but also activities. We hang out at dinners and
go out and play, things like that.”
Most Automattic employees also have occasional
social gatherings with other employees who live in the
area. “Toronto is a two-hour drive, and there’s a lot of
[Automattic] people in that area,” says Abeid. “So we’ll
try to do a yearly Automattic dinner in Toronto for people who are local.”
But the most memorable gathering each year is the
Grand Meetup, an annual week-long event attended by
all Automattic employees. One annual meeting was in
Whistler, B.C. The company encourages networking by
assigning employees to eat with different co-workers
at each meal. A statistical analysis revealed that after
attending a recent Grand Meetup, new hires formed
strong network ties and current employees expanded
their connections with co-workers in other teams
around the company.
©ZUMA Press, Inc./Alamy Stock Photo
* O. Staley, “The Creator of WordPress Shares His Secret to Running a Remote Workplace,” Quartz at Work, May 29, 2018; M. Hollingsworth, “Cesar Abeid,
Happiness Team Lead at Automattic,” The Remote Show (podcast), April 24, 2019, https://weworkremotely.com/the-remote-show-podcast/cesar-abeid-happiness-team-lead-at-automattic. “Work With Us,” Automattic (blog), accessed February 7, 2020, https://automattic.com/work-with-us/.
Evaluation Apprehension
Team members are often reluctant to mention ideas that seem
silly because they believe (often correctly) that other team
members are silently evaluating them.100 This evaluation
apprehension is based on the individual’s desire to create a
favourable public image and need to protect self-esteem. It is
most common in meetings attended by people with different
levels of status or expertise
or when members formally
evaluation apprehension
Occurs when individuals are
evaluate each other’s perreluctant to mention ideas
formance throughout the
that seem silly because they
year. Creative ideas often
believe that others in the
sound bizarre or illogical
decision-making team are
when first presented, so
silently evaluating them.
evaluation apprehension
tends to discourage employees from mentioning them in
front of co-workers.
Pressure to Conform
Team cohesion leads employees to conform to the team’s
norms. This control keeps the group organized around common goals, but it may also cause team members to suppress
their dissenting opinions, particularly when a strong team
norm is related to the issue. When someone does state a point
of view that violates the majority opinion, other members
might punish the violator or try to persuade them that the
opinion is incorrect. Conformity can also be subtle. To some
extent, we depend on the opinions that others hold to validate
our own views. If co-workers don’t agree with us, we begin to
question our own opinions even without overt peer pressure.
Chapter Eight
Overconfidence (Inflated Team Efficacy)
To some degree, teams are more successful when their
members have collective confidence in how well they work
together and the likely
success of their team
team efficacy The collective
belief among team members
effort. This team efficacy
of the team’s capability to sucis similar to individual
cessfully complete a task.
self-efficacy, which we
discussed in Chapter 3.
High-efficacy teams set more challenging goals and are
more motivated to achieve them, both of which increase
team performance.
Unfortunately, there is a curvilinear relationship
between team efficacy and the quality of team decisions (as
well as other forms of team performance). In other words,
teams make worse decisions when they are overconfident
as well as underconfident.101 Overconfident teams are less
vigilant when making decisions, partly because they have
Team Dynamics
more positive than negative emotions and moods during
these events. They also engage in less constructive debate
and are less likely to seek out or accept information located
outside the team, both of which undermine the quality of
team decisions.
Why do teams become overconfident? The main reason is
a team-level variation of self-enhancement (see Chapter 3).
Team members have a natural motivation to believe that the
team’s capabilities are above average. Overconfidence is more
common in highly cohesive teams because self-enhancement
occurs for things that are important. By definition, members
of cohesive teams value their association with the team.
Overconfidence is also stronger when the team has external
threats or competition because these adversaries generate
“us versus them” differentiation. Team efficacy is further
inflated by the mutually reinforcing beliefs of the team.
Employees develop a clearer and higher opinion of their
team when other team members echo that opinion.
©James Brittain-VIEW/Alamy Stock Photo
Google applied its legendary deep analytics to find out why some teams worked better than others and made better decisions.
Google researchers eventually discovered that team composition is less important than the team norm of psychological
safety. In other words, teams make better decisions when all team members feel comfortable speaking up and are sensitive
to the feelings of their fellow employees. From these results, Google created a checklist urging team leaders to actively
listen during meetings, avoid interrupting teammates, rephrase what team members have said, and discourage anyone from
being judgmental toward others. “I’m so much more conscious of how I model listening now, or whether I interrupt, or how I
encourage everyone to speak,” says Sagnik Nandy, who leads one of Google’s largest teams.*
* C. Duhigg, Smarter, Faster, Better: The Secrets of Being Productive in Life and Business (New York: Random House, 2016), Chap. 2; “Guide: Understand
Team Effectiveness,” Re:Work (Google Blog) (blog), accessed May 3, 2019, https://rework.withgoogle.com/print/guides/5721312655835136/; “How to
Foster Psychological Safety on Your Teams” (Google), accessed May 3, 2019, https://docs.google.com/document/d/1PsnDMS2emcPLgMLFAQCXZjO7
224 Part Three
Team Processes
Team decision making is fraught with problems, but there
are several ways to minimize these pitfalls. Checks and balances need to be in place to prevent the leader or other individuals from dominating the discussion. The team should
also be large enough to possess the collective knowledge to
resolve the problem, yet small enough that the team doesn’t
consume too much time or restrict individual input. Team
members should be confident in their decision making but
also be wary about being overconfident. This calls for team
membership with sufficient diversity as well as team norms
that encourage critical thinking.
Another important ingredient for effective team decision
making is an environment in which team members have psychological safety.102 Psychological safety is a shared belief that
engaging in interpersonal risk-taking will not have adverse consequences. This belief exists
psychological safety A
when employees are conshared belief that it is safe
fident that they can conto engage in interpersonal
structively disagree with the
risk-taking; specifically, that
majority, present weird ideas,
presenting unusual ideas, constructively disagreeing with
or experiment with novel
the majority, and experimentbehaviours without fear that
ing with new work behaviours
co-workers will belittle them
will not result in co-workers
or that the company will
posing a threat to one’s
limit their career progress.
self-concept, status, or career.
Psychological safety requires
team norms that encourage employees to respect and value one
another, demonstrate interest in one another, be open-minded
about and tolerant with co-workers’ opinions, and show positive intentions toward one another. Showing positive intentions involves displaying positive emotions and nonthreatening
behaviour when discussing different points of view.
These recommendations improve most types of teamlevel decisions. OB studies have also identified four team
structures that encourage creativity in a team setting: brainstorming, brainwriting, electronic brainstorming, and nominal group technique.
Brainstorming is a team event in which participants try to
think up many ideas for the ultimate objective of generating
the most creative ideas.103
The process was introbrainstorming A freewheeling,
duced by advertising execface-to-face meeting where
team members aren’t allowed
utive Alex Osborn in 1939
to criticize but are encouraged
and has four simple rules to
to speak freely, generate as
maximize the creativity of
many ideas as possible, and
ideas presented: (1) Speak
build on the ideas of others.
freely—describe even the
craziest ideas; (2) don’t criticize others or their ideas; (3)
provide as many ideas as possible—the quality of ideas
increases with the quantity of ideas; and (4) build on the
ideas that others have presented. These rules are supposed
to encourage divergent thinking while minimizing evaluation
apprehension and other team dynamics problems.104
Brainstorming fell out of favour after numerous lab studies
reported that it doesn’t produce as many ideas as individuals
working alone. Production blocking, evaluation apprehension, and social loafing were identified as the main culprits.105 These findings are perplexing because some of the
most successful creative agencies and product design firms
rely on brainstorming to help them in the creative process.106
One reason why lab studies differ from real-world experiences is that effective brainstorming requires a skilled facilitator who ensures the rules are followed, encourages everyone
to speak up, manages dominant participants, keeps the group
focused on the topic, and maintains an efficient flow of ideas.
In contrast, lab studies rely on students who have never done
brainstorming and whose facilitator is randomly picked from
the group. Also, brainstorming asks participants to provide
crazy ideas, which requires confident employees in a collaborative learning orientation culture that prioritizes psychological safety. In contrast, most lab studies involve students who
barely know one another, are likely highly sensitive to how
they are perceived by peers, and probably have limited confidence in their skills for this task. Finally, brainstorming sessions are intended to produce the most creative ideas, whereas
most lab studies merely count the number of ideas.107
Brainstorming likely improves team creativity, but it does
have limitations. First, even with people who are trained and
experienced, brainstorming suffers from production blocking. Great thoughts are forgotten while team members listen
to one another’s ideas, and sparks of insight are forfeited if
team members do not listen to one another’s ideas. A second
problem, called fixation or conformity effect, is that hearing
another person’s ideas tends to restrict the variety of ideas that
we subsequently think about. In brainstorming, participants
are asked to openly describe their ideas, but the first few verbal descriptions might cause participants to limit their thinking to ideas similar to those first suggestions rather than other
categories of ideas. On a positive note, however, neuroscience
studies report that people think more creatively when exposed
to moderately creative ideas generated by other people.108
Brainwriting is a variation
of brainstorming that minimizes the problem of production blocking by removing
conversation during idea generation.109 There are many
brainwriting A variation of
brainstorming whereby participants write (rather than speak
about) and share their ideas.
Chapter Eight
forms of brainwriting, but they all have the common feature that
individuals write down their ideas rather than verbally describe
them. In one version, participants write their ideas on cards and
place them in the centre of the table. At any time, participants can
pick up one or more cards from the centre to spark their thinking
or further build (piggyback) on those ideas. In another variation,
each person writes one idea on a card, then passes the card to the
person on their right. The receiving person writes a new idea on
a second card, both cards are sent to the next person, and the process is repeated. The limited research on brainwriting suggests
that it produces more and better quality ideas than brainstorming
due to the lack of production blocking.
Electronic Brainstorming
Electronic brainstorming is similar to brainwriting but
uses digital networks rather than handwritten cards to document and share ideas.
electronic brainstorming
After receiving the quesA form of brainwriting that
tion or issue, participants
relies on networked computenter their ideas using
ers for submitting and sharing
special digital software.
creative ideas.
The ideas are distributed
anonymously to other participants, who are encouraged to
piggyback on those ideas. Team members eventually vote
electronically on the ideas presented. Face-to-face discussion usually follows. Electronic brainstorming can be quite
effective at generating creative ideas with minimal production blocking, evaluation apprehension, or conformity
Team Dynamics
problems.110 It can be superior to brainwriting because ideas
are generated anonymously and they are viewed by other
participants more easily. Despite these numerous advantages, electronic brainstorming is seldom applied because it
tends to be too structured and technology-bound.
Nominal Group Technique
Another variation of brainwriting, nominal group technique,
adds a verbal element to the process.111 The problem is
described, team members silently and independently write
down as many solutions as they can, then they describe their
solutions to the other team
nominal group technique A
members, usually in a
variation of brainwriting
round-robin format. As
consisting of three stages:
with brainstorming, there
participants (1) silently and
is no criticism or debate,
independently document their
ideas, (2) collectively describe
just clarification. Finally,
these ideas to the other team
participants silently and
members without critique,
independently rank-order
and then (3) silently and indeor vote on each proposed
pendently evaluate the ideas
solution. Nominal group
technique has been used in
real-world decisions, such as identifying ways to improve tourism in various countries. This method tends to generate more
and better-quality ideas than occur in traditional interacting and
possibly brainstorming groups. However, production blocking
and evaluation apprehension still occur to some extent. Training
improves this structured approach to team decision making.112
Chapter Summary
Define teams and informal groups, and explain why employees
join informal groups.
Teams are groups of two or more people who interact and influence
one another, are mutually accountable for achieving common goals
associated with organizational objectives, and perceive themselves
as a social entity within an organization. All teams are groups,
because they consist of people who are assembled together. Not all
groups are teams, however; some groups do not exist to achieve
organizational objectives and members of th